The tourism body whose chief executive resigned last month in an expenses scandal could lose tens of thousands of pounds in public funds after councils announced plans to pause their subscriptions.

Sir Gary Verity, who ran Welcome to Yorkshire (WTY) since 2008, quit suddenly in March amid reports he had misclaimed at least £40,000 in expenses and been accused of bullying.

Sheffield council said it would not be paying its annual £50,000 subscription until it was sure the city’s taxpayers’ money had not been misappropriated.

Hull council, which pays £7,200 annually to WTY, said it would not hand over any more money until two independent investigations into Verity’s expenses and behaviour had been concluded.

WTY has received £14.89m in public funds over the past five years, but as a private company is not obliged to be transparent about its spending.

Julie Dore, Sheffield council’s leader, said she had written to WTY to “ensure the council’s contribution has been used appropriately”, the Sheffield Star reported.

She told a council meeting: “We have not paid our subscription so far this year, so I am more than prepared to delay that until we have a satisfactory response that Sheffield council taxpayers money has not been misappropriated.”

The leader of Hull council, Stephen Brady, resigned from the WTY board on Monday after saying he had been kept in the dark about concerns relating to expense claims by Verity, as well as allegations of poor behaviour towards staff.

Brady said in a statement: “Whilst I am a strong and passionate advocate of the Yorkshire brand and the great work that many Welcome to Yorkshire staff have undertaken with partners to develop this over many years, I have had no option but to resign from the Welcome to Yorkshire board, given the seriousness of the developing allegations and the lack of clarity and transparency provided to me since being invited to join the board late last year, including at my first board meeting on 12 March 2019.

“It is absolutely essential that the investigations into these issues are entirely independent, are conducted with complete transparency and rigour and that all findings and recommendations are fully published. Hull city council will continue its membership of Welcome to Yorkshire but will not be making any further contributions until these investigations are completed and any actions or changes recommended by the investigations are implemented.”

Another board member, Richard Cooper, the leader of Harrogate borough council, proposed that all future spending over £250 should be published, without exception, in order to restore public confidence, and that the agendas and minutes of board meetings be made public. He told the Yorkshire Post: “Being a major recipient of public funds, the public needs confidence that not only is WTY successful for Yorkshire but that it is a fit custodian of public funds and an organisation that supports its staff and treats them with respect.”

WTY said it was considering Cooper’s recommendations and understood the need to assure councils of how it spent public money.

In a statement it said: “Welcome to Yorkshire maintains a very close working relationship with all of the local authorities to deliver their service level agreements and partnerships. We understand the need for assurance to all of our partners and that’s why we are instigating two independent investigations into expenses, behaviour and governance. The findings of these will be reported in a clear and transparent way in due course.”

Verity has agreed to voluntarily reimburse WTY for monies owed and said in a statement: “Over the last 10-and-a-half years I have always tried to set the highest standards of personal performance and leadership. Where this has been achieved, I am grateful and when, on occasions, I have fallen short, I apologise.”