Mark Garnier, a member of the Treasury Select Committee, has called for a parliamentary grilling over how the regulator approved the appointment of Co-op Group's former chairman Paul Flowers after a video emerged showing him handing over money to buy hard drugs.
The Labour Party acted quickly to suspend Flowers, who is also a Methodist minister, after a video of the drug deal emerged. He claimed that job pressures and a family bereavement led him to buy crack cocaine, crystal meth and ketamine.
The 63-year-old ex-bank chief, who was in charge at the time of the Co-op's near collapse, was filmed counting out £300 in cash. The Mail on Sunday said a friend of Flowers, Stuart Davies, handed over the footage and a series of text messages.
One text said: "Have 2 bags of Charlie here and have ordered another 5... enough? Px".
Flowers was paid £132,000 a year as chairman of the Co-op Bank from 2010 until May 2013, when he stepped down.
He faced embarassment in front of the TSC earlier this month after telling MPs that Co-op's assets stood at £3bn when, in fact, they were around £47bn.
The Co-op Bank is one of UK's smallest lenders with 6.5 million customers and a 1.5% share of the current account market.
Embattled Co-Op Bank
Former HSBC banker Niall Booker took over as leader in May after ex-CEO Barry Tootell stepped down in the wake of suggestions by Moody's that the Co-op's banking operation might need a government bailout.
Flowers resigned as chairman to take responsibility for a £1.5bn (€1.8bn, $2.5bn) black hole in its balance sheet and was replaced by Richard Pym a month later.
The new chief executive revealed that the group would cut jobs as part of the management's five-year plan to turn things around. Booker said it would take four to five years to fix the fortunes of the ethical lender.
"You can see by what's happened to other banks, how long it's taken to turn these things around. It's going to take us four to five years to restructure the bank," said Booker.