Nigel Farage is scrambling to contain a storm over an 'illegal' donations sting today as Reform holds a crucial conference.
The party leader insisted no laws had been broken after undercover footage emerged of him and aides discussing taking money from a fake US businessman.
Mr Farage claimed the operation was a 'clear case of entrapment' - but also acknowledged the video showed aides 'saying things that perhaps should not have been said'.
Two key figures in Reform, James Orr and Dan Jukes, are standing aside from their respective jobs as head of policy and assistant to the leader while allegations are looked into.
The furore is threatening to overshadow Reform's gathering in Birmingham, where Mr Farage is hoping to revive the party's fortunes after a torrid spell.
A report broadcast by Channel 4 News claimed Reform was seeking funding from a US firm for three polls it commissioned earlier this year costing £32,500.
Senior Reform figures including leader Nigel Farage are said to have discussed a £500,000 donation from a US businessman through his son, who lives in the UK
The purported donors were in fact undercover reporters from investigative group Verbatim posing as an American financier and his UK-based son.
The provenance of the polls were not revealed when they were published in national newspapers.
Senior officials including Mr Farage are also said to have discussed a £500,000 donation from the fake businessman through his son.
Speaking to LBC, Mr Farage said: 'The party has broken no laws. The party has not taken any dodgy money or anything like that whatsoever.
'However, it is a clear case of entrapment, and they worked at it for a very, very long time, and they got a couple of our contractors to say things that perhaps should not have been said.
'And as a result of that, you know, they have been removed this morning. And yeah, you know, I'm not happy about it.'
On the polls, which were published in the run-up to local elections, he said: 'Whilst the poll benefited Reform, it wasn't commissioned by Reform.
'It had nothing to do with Reform. It was an independent third party that did it. So that's nothing. That's nothing. Polls are funded by overseas people every single week. Every single week.'
A Reform spokesman said: 'Reform UK has launched an investigation following the broadcast of a Channel 4 News programme.
'Both individuals involved have stepped down from their respective positions pending the outcome of the investigation.
'The party believes it is important that the investigation is allowed to proceed independently and without prejudice. No further comment will be made while the investigation is ongoing.'
Reform UK chairman Lee Anderson told Sky News there was 'no chance' of them returning to the party.
However, deputy leader Richard Tice refused to rule out a comeback, telling BBC Radio 4's Today programme: 'Let's wait and see what the investigation says.'
Farage and his senior aide Dan Jukes were filmed meeting a US businessman and his son, who lives in the UK, and discussing donations. The men were both undercover members of Verbatim, a group of investigative journalists
Mr Jukes said in a statement this morning: 'This was entrapment over a prolonged period of nearly a year by foreign-funded climate change activists.
'I totally deny any wrongdoing but have stepped back from politics in order to clear my name.'
Foreign political donations are banned in the UK. The donation was never made.
The Lib Dems have written to the Metropolitan Police and Electoral Commission about the issue.
Labour has also reported the allegations to the police, and the Greens have called for a probe.
Labour Party chair Bridget Phillipson said the 'scandal goes right to the top of Reform'.
'Farage must co-operate with the authorities and urgently prove that his top team haven't broken the law and secretly plotted to undermine our democracy,' she posted on X.
In a letter to the Met Police, Lib Dem frontbencher Lisa Smart wrote: 'The breach raises alarming questions about whether there has been a wider complacency toward foreign interference by the individuals involved.'
Channel 4 News said it had 'thoroughly checked and verified' the work by Verbatim and 'did not pay for the polling and paid no money to Verbatim or any associated company'.
Mr Anderson told Sky News of Mr Jukes and Mr Orr: 'They've stepped down. They was told, you know, they had to step down, they have stepped down, and that's got to be the right thing to do on the day, the first day of our conference.
'Let's remember, we've got 5,000 members coming through the door today to listen to what we've got to say about our first 100 days in government and how we're going to change the course of this country.
'So it's right to get rid of this distraction straight away. The pair concerned have gone, and the investigation starts today. It's as simple as that.'
He added: 'There's no chance of them coming back. They've stepped aside.
'You know, we're a serious party, you know, and sometimes in politics, you have to make tough decisions, harsh decisions.'
Mr Tice denied that the party broke any laws regarding allegations about impermissible donations.
He told Today: 'The reality is that no money has been received whatsoever.
'We've got a KC's opinion that makes clear no rules have been broken.'
He added that 'no benefit in kind was received'.
Mr Farage is expected to give the first of his two conference speeches this afternoon, promising to declare a 'national emergency' on his first day in government, introducing a flood of legislation and doing 'anything and everything' to deliver his party's policies.
He will say: 'Within days of winning the general election, we will introduce dozens of Bills and force Parliament to sit all through summer for seven days a week to pass them.
'Britain is in serious trouble. We don't have time to wait around to fix it.'
The two-day conference in Birmingham is expected to hear from other senior Reform figures setting out their own pledges for their first 100 days in office, as well as an address from Jordan Bardella, leader of the French National Rally.
Mr Farage is expected to announce that any frontbenchers who fail to deliver on their pledges 'will be sacked'.
He is also due to make his own promise to focus on reducing the cost of living and lead on efforts to end small boat crossings in the Channel.