An independent review will examine how the “cult-like” leader of Yorkshire’s tourism body was able to claim excessive personal expenses, beyond his £243,000 salary, after bullying allegations that led to his having “behavioural management counselling”.

Sir Gary Verity, who was knighted in 2015 after organising the Tour de France’s trip to Yorkshire in 2014, resigned on Friday as chief executive of Welcome to Yorkshire.

The Sunday Times claimed he had submitted expense claims relating to the funeral of his sister, who died in January. Welcome to Yorkshire said Verity had paid back money last weekand had made a series of claims at “a very difficult time for him and his family”. A spokeswoman refused to comment on claims by the Sunday Times that that was a five-figure sum.

As a private firm Welcome to Yorkshire does not have to be transparent about its £4m annual income, despite accepting millions in public funds during Verity’s tenure. Last year the Leeds City region agreed to fund the organisation with £830,000 for 12 months, as well as pledge a further £400,000 for the 2018 Tour de Yorkshire.

Accounts show Verity earned in the year to 2018, £243,453 . He was widely praised for his marketing nous, which, for instance, seduced the Tour de France by turning Wensleydale’s Buttertubs Pass into “Côte de Buttertubs”, and renaming a nondescript A-road near Harrogate as Côte de Blubberhouses.

Verity, a sheep farmer who juggled lambing with his tourism duties, was also investigated after claims he had bullied staff. Concerns about Verity’s behaviour towards staff were raised again recently, following previous allegations in 2014 and 2016, according to a Welcome to Yorkshire spokeswoman.

The spokeswoman said: “The board took the appropriate disciplinary action on both occasions including a final written warning and [notice] that he should attend behavioural management counselling.”

The new independent investigation will not examine how these allegations were handled because the complainants were satisfied that Verity had resigned, she said.

Dee Marshall, former head of communications for Welcome to Yorkshire, said Verity had “really hurt people” at the company. Speaking to BBC Look North she said: “I witnessed behaviour that was completely unacceptable in my opinion, and a lot of people were very hurt, very hurt.”

However, Welcome to Yorkshire said: “His resignation was not directly linked to concerns ‘in relation to his behaviour towards staff and his expenses’.”

Ron McMillan, chair of the Welcome to Yorkshire Board, said: “The board don’t believe Sir Gary Verity’s expenses require police investigation. During a difficult time for [him] he failed to follow the correct expense procedures. We are now getting these policies and procedures independently reviewed. Should that review highlight any irregularities which require further investigation, we will inform the appropriate authorities.”

But Susan Briggs, director of the Tourism Network, in Masham, North Yorkshire, said McMillan, a former partner at the accounting firm PWC, should resign. She said she was furious that he issued a statement saying it was “very much business as usual for Welcome to Yorkshire” following the resignation. “It’s far too complacent an attitude,” she said.

She called for the board to be reconstituted. She urged those who had funded the organisation to insist on “greater industry consultation, meaningful targets and evaluation when they give grants and payments to WTY, particularly at a time when budgets are so stretched”.

Verity 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. My health is now my main priority. I ask for time and space to heal.”