Indigenous Affairs Minister Nigel Scullion says he has referred an allegedly "fabricated email" he received to the Australian Federal Police (AFP), which contains allegations against outgoing Northern Land Council (NLC) CEO Joe Morrison.

Key points: Senator Scullion said email raised several allegations and was likely a breach of Telecommunications Act

Senator Scullion said email raised several allegations and was likely a breach of Telecommunications Act NLC slams allegations contained in email as "spurious"

NLC slams allegations contained in email as "spurious" Chief executive Joe Morrison to stay on as CEO until March

Mr Morrison resigned from his position after four years at the helm of the nation's largest Aboriginal land council on Wednesday, citing personal reasons.

The NLC and Mr Morrison have strongly denied questions raised in the Sunday Territorian newspaper at the weekend about how the CEO handled a potential conflict of interest relating to a staffer's employment benefits.

"The claims that Mr Morrison acted inappropriately in relation to expenditure of any monies are absolutely false, and any suggestion to the contrary is defamatory," an NLC spokesman said.

Senator Scullion said he had received an email raising several allegations, which he did not detail, and said it was, "likely to be a breach of the Telecommunications Act".

It is understood the allegedly "falsified" letter was sent to Senator Scullion's office from a false email address, rather than the purported author's official account.

"We've sent that [letter] off to the Department, and the Department has said that that email's false," Senator Scullion said this morning.

"And so, I've referred the breach of the Telecommunications Act now to the Federal Police, and it's entirely a matter for them."

Senator Scullion alleged the "email was found to have been not sent by the person it was sent [from]. It was a fabricated email," he said.

'Spurious allegations' in email

The NLC spokesman said the letter sent to Senator Scullion, "was anonymous, and contained spurious allegations".

Senator Scullion with Northern Land Council CEO Joe Morrison earlier this year. ( ABC News: Mike Donnelly )

"The NLC is a Commonwealth statutory authority, and of course it would fully cooperate with any AFP investigation," he said.

He reiterated the NLC was "subject to audit by the Australian National Audit Office, and its administration practices and accounting are entirely above board".

The NLC has indicated Mr Morrison would stay on in the role until March 2019.

"Mr Morrison has done nothing wrong and will continue in the CEO's office until his resignation takes effect," the spokesman said.

It remains unclear exactly when the letter was referred to the AFP by Senator Scullion.

Senator Scullion paid tribute to the work of Mr Morrison during his time with the NLC.

"Joe and the land council have staunchly represented the interests of Aboriginal people in the northern part of the Northern Territory and I'd just like to reflect on what an absolutely remarkable job that he's done," he said.

The AFP and the Department of Prime Minister and Cabinet have been contacted for further comment.