A Conservative has attempted to highlight Ed Miliband's appointment of a former News International journalist as his director of strategy, claiming that Tom Baldwin had hired private investigators to hack into his bank account.

Michael Ashcroft, a former deputy Conservative chairman and generous donor to the party, posted allegations on the website that he owns, Conservative Home. Tim Montgomerie, the website's editor, circulated the posting to political journalists.

Ashcroft has already published Dirty Politics Dirty Times, a book criticising the way the Times newspaper had conducted an investigation into his business dealings in the 1990s.

Ashcroft writes on Conservative Home: "I know of a number of infringements of the law of which Mr Baldwin has been guilty but, for the purposes of this blog, I will limit consideration to the commissioning of a private detective to break into a bank account. This took place in 1999, when Mr Baldwin was a senior journalist at The Times, News International's flagship daily, a position he held until his appointment by Mr Miliband".

He claims that Baldwin went to a "blagger" to find out about details of a bank account used by Ashcroft to fund the Conservative Party. He identifies the account as the Drummonds branch of the Royal Bank of Scotland in Charing Cross Road, London, and claims, once the information was obtained, Baldwin published the information at the time of Conservative conference in 1999.

In his book Aschroft writes: "The donations consisted of money from my personal savings which were sent through one of my accounts in Belize to the Conservative Party".

The payments were investigated by The Times on the suspicion that Ashcroft was seeking to circumvent the guidelines on payments to political parties. Ashcroft insists the payments, not known to the public at the time of publication, were in line with Conservative rules.

Ashcroft asserts he asked the police to investigate the leak of details of his account, but said only a half-hearted investigation by the police occurred, and The Times then gave him a series of evasive answers. He also claims that Baldwin handed the story to the Guardian and the Independent.

A senior Labour source said: "Tom has never commissioned a private investigator. These are allegations from Michael Ashcroft, the Tory party's largest donor, to distract attention from the serious questions David Cameron has to answer about his decision to bring Andy Coulson into the heart of the government machine."

The Times always argued the story was a public interest story to find out who was the chief funder of the Conservative Party. The funding was not published.

Ed Miliband, the Labour leader, said on Radio 4's World at One that he had made checks on Baldwin before appointing him as strategy director, adding that Baldwin denies that he had used private investigators to gather his stories. Miliband admitted he had been too slow to distance himself from the Murdoch empire and admitted he had met Rupert Murdoch at a social event a fortnight ago and did not raise the issue of phone hacking.