In the recording, first revealed by The Courier-Mail and also obtained by Fairfax Media, Mr Ashby says "this is an opportunity for us to make some money on this if we play this smart" through a system of inflating charges and claims. Mr Ashby is also heard saying he would deny ever making the proposal. One Nation senator Pauline Hanson and chief-of-staff James Ashby. Credit:Alex Ellinghausen Labor has said the revelations amount to an apparent "conspiracy to defraud taxpayers" and has referred them for investigation by the Electoral Commission of Queensland, the Queensland police and the Australian Federal Police. Prime Minister Malcolm Turnbull said Senator Hanson would have to respond to the report and emphasised it was "vitally important that all of our electoral laws are strictly complied with". Mr Turnbull said he was seeking advice from Attorney-General George Brandis and the AFP. On Monday, Mr Ashby denied acting improperly, took responsibility for the idea and said it wasn't executed "because it wasn't the right decision for our candidates". He insisted that the party "isn't about gouging the taxpayer at all".

In a highly unusual press conference dominated by Mr Ashby – with party leader Senator Hanson taking a back seat – the chief-of-staff said the recording was "embarrassing" but denied his large public profile was a problem. One Nation powerbroker James Ashby. Credit:Andrew Meares "I do not believe I am a liability," Mr Ashby said. Senator Hanson declined to publicly criticise her staffer but said his idea in the meeting "was raised and it was knocked on the head there and then". This rejection of the idea is not contained in the recording. "It is a poor choice of words and I think the honesty is reflected in the transparency of the party," Mr Ashby said in an interview with ABC radio earlier on Monday.

"What we've always done is the right thing by our candidates and we've never claimed back any money that is not deserved." Mr Ashby said he had never "skimmed" One Nation revenue by taking a slice, arguing that the amounts the party charges made it impossible to make a profit, and they had "never made money off candidates". "Candidates have never, ever, been charged more than the the $3500 package and therefore there is no way of making profiteering off an election, I can assure you right now. You only get back what you put in," he said. "It's one of those moments where an illegal recording has been put out in to the public and no one was aware that it was occurring. These were brainstorming sessions that, look, quite obviously have never come to fruition and we're not about doing anything wrong." Under Queensland law, it is not illegal for one party to a conversation to record it, so long as they do not publish the recording. However, there is a public interest exemption for publishing under some circumstances.

Labor senator Murray Watt said the new reports contained "extremely serious allegations which, if they are true, amount to a very serious criminal conduct". Senator Watt claimed previous revelations had painted a picture of One Nation's leadership abusing the rules to benefit the party and themselves. "And now today we have even more shocking allegations about what appears to be a conspiracy to defraud taxpayers by rorting the rules around public funding of election campaigns and election materials," he said. Allegations of profiteering on the part of Mr Ashby emerged late last year when The Australian Financial Review reported that candidates were being pushed into using his signage business. The party has faced increased scrutiny over its finances more broadly and is also being probed by the Australian Electoral Commission.

Loading Attention has particularly focused on a One Nation-branded Jabiru aircraft, used extensively for campaigning purposes and worth about $100,000 but not declared under AEC donations disclosures. Senator Hanson and Mr Ashby have offered differing explanations for the omission. Follow us on Facebook