Christine Lee has made large donations to Labour MP Barry Gardiner's office, but he said MI5 has reassured him they were all above board. Her son resigned from his office today.
MI5 has warned that a Chinese government agent has been working in parliament "to subvert the processes", MPs have been told.
A letter was sent to MPs by Speaker Sir Lindsay Hoyle who said MI5 warned him a woman called Christine Lee has been "engaged in political interference activities on behalf of the Chinese Communist Party, engaging with members here at parliament".
MI5 sent out an "interference alert" warning Ms Lee has "facilitated financial donations to serving and aspiring parliamentarians on behalf of foreign nationals based in Hong Kong and China...done covertly to mask the origins of the payments".
Labour frontbencher and former minister Barry Gardiner has been named as an MP who accepted large donations from the Chinese woman, and he confirmed her son was working for him but resigned today.
Labour MP Barry Gardiner accepted donations from the woman, and her son was working for him
Longstanding investigation but warning is new
Home Secretary Priti Patel said a longstanding investigation into Ms Lee has been ongoing but Thursday's revelations about her are "relatively new" and said what she has been engaging in "is currently under the criminal threshold but the alert puts MPs on notice".
She denied the announcement today was to distract from calls for the prime minister to resign over Number 10 lockdown parties, saying it was MI5 and the parliamentary security services' decision when to release the alert.
Ms Patel added there is ongoing work on what further measures the government can take, and this is something she is working on changing through the law.
Christine Lee 'involved in political interference in UK'
MI5 said Ms Lee, a lawyer, has been involved with MPs and hopeful MPs as well as members of the now-disbanded all-party parliamentary group, Chinese in Britain.
In the alert, it said: "Lee has acted covertly in coordination with the United Front Work Department of the Chinese Communist Party (UFWD) and is judged to be involved in political interference activities in the UK."
Sir Lindsay told MPs if they have been approached by Ms Lee they should contact parliament's director of security.
Ms Lee has been pictured over the years with former Labour leader Jeremy Corbyn, talking to David Cameron in 2015 and was given a prize by Theresa May for "promoting engagement, understanding and cooperation between the Chinese community and wider UK society".
The law firm she runs claims to be the "first and only" UK-Chinese law firm authorised by the Chinese Ministry of Justice as a foreign law firm to operate in China.
Donations to Labour and Lib Dem MPs
The MPs' register of interests shows Ms Lee has made more than £700,000 in donations to parliamentarians, much of that to Mr Gardiner.
He told Sky News he has been liaising with MI5 "for a number of years" about Ms Lee "and they have always known, and been made fully aware by me, of her engagement with my office and the donations she made to fund researchers in my office".
Mr Gardiner added: "Steps were taken to ensure she had no role in either the appointment or management of those researchers.
"They are also aware that I have not benefitted personally from those donations in any way. She ceased funding any workers in my office in June 2020."
He said MI5 has assured him funding Ms Lee provided to him was not through "improper" means.
Mr Gardiner added that her son had been working for him as a diary manager but he resigned earlier on Thursday and MI5 said they "have no intelligence that shows he was aware of, or complicit in, his mother's illegal activity".
The MP's register of interests also shows current Lib Dem leader Sir Ed Davey received a £5,000 donation from Ms Lee in 2013.
China-sanctioned Tory raises concerns over safety of activists
Leading Tory Iain Duncan Smith, who is among several MPs China has placed sanctions on for speaking up against its treatment of the Uyghurs, told Sky News Ms Lee should be made to leave the UK and said he was concerned for people he is helping flee the Chinese regime.
He said: "I think this is clearly a form of spying, I hear they're not going to be kicked out.
"Why in heaven's name is such an agent allowed in the country?"
Mr Duncan Smith said his offices may have been targeted for information of people he was helping escape China.
"I don't want to be the source of information about them that goes back to the Chinese government for them to be arrested or their families to be abused. This is a serious, serious issue and has massive repercussions."