Reform UK did not break electoral law when senior figures discussed how to disguise foreign donations, the party’s own investigation has concluded.

The investigation, sparked by a Channel 4 News report on Reform’s funding, found two senior figures had “said things that were wrong, careless and in one instance untrue”.

But the 27-page report published on Wednesday concluded the proposed £500,000 donation from a foreign source discussed in Channel 4’s report “did not take place” and Reform had not commissioned polls paid for by undercover reporters.

A Reform spokesperson said the party believed the production company involved in the report, Verbatim Investigations, had “acted unlawfully” and said it would take “appropriate legal action in due course”.

Channel 4 said it stood by its reporting, which had undergone “extensive editorial and external legal scrutiny prior to broadcast”.

Labour described the Reform investigation as a “whitewash” and said it did not “exonerate” either the party or its leader, Nigel Farage.

The Channel 4 report, in which undercover journalists posing as an American donor and his son filmed senior Reform figures discussing how to disguise donations, overshadowed the party’s conference in Birmingham last month.

It also saw long-time Farage aide Dan Jukes and the party’s head of policy James Orr suspended, pending the outcome of Reform’s own investigation.

The Metropolitan Police said it would also investigate the footage as part of an ongoing inquiry into donations to the party.

Reform’s investigation said it had found “no evidence” that either man had done anything to facilitate an illegal donation.

It also said Mr Jukes, described as a “consultant” who “also worked with other clients”, had commissioned the polls on his own account and not on behalf of the party.

But it strongly criticised the way they had spoken to the undercover reporters about both the proposed £500,000 donation and arrangements with pollster JL Partners, which carried out the polls discussed in the Channel 4 report.

It said the undercover reporters had made a “lawful” request for arrangements to be kept private which had been “allowed to colour the way lawful arrangements were described, until they were being spoken of in the vocabulary of concealment by people who had nothing to conceal”.

The investigation said Mr Orr had been “wrong” to suggest that nobody would find out about impermissible donations and use “extremely condescending terms” to describe the Electoral Commission.

It also criticised Mr Jukes’s description of polling arrangements as “clandestine” or “off the books”, saying this was “the reason a lawful arrangement could be presented as a plot”.

It said he had said something he “did not know to be true” when he claimed the party had received money from foreign donors through their children.

The report recommended changes to how the party handled prospective donors, including earlier preliminary checks on their identity, and requiring contractors to provide details of their other clients.

A Reform UK spokesperson said: “Following the allegations raised by Verbatim Investigations and Channel 4 on September 3, Reform UK commissioned a comprehensive internal investigation.

“The investigation examined all relevant evidence, including witness interviews, documentary records and electronic communications.

“Having concluded the review, the investigation found no evidence that any laws were broken.

“Reform UK takes its obligations on governance and conduct extremely seriously.

“We consider that the production company – Verbatim – acted unlawfully and will be taking the appropriate legal action in due course.”

A Channel 4 spokesperson said: “Channel 4 News stands by its journalism.

“The investigation underwent extensive editorial and external legal scrutiny prior to broadcast. Given the ongoing police investigation, we will not be commenting further.”

Labour Party chairwoman Bridget Phillipson said: “You can find more whitewash in this report than at your local B&Q. Nothing in it exonerates Reform or Nigel Farage from the serious allegations that they still face. They can’t run from the truth forever.”

Verbatim Investigations has been contacted for comment.