By Adam Carey & Benjamin Preiss
The Labor Party has hit out at police for the "completely unecessary" dawn raids on former staffers and flagged possible legal action.
In a statement Victorian Labor said it had also received "concerning reports" that police told the people interviewed that they did not need legal representation during that process.
One former electorate officer who worked for two MPs who are now senior Andrews government ministers says he was arrested at his home at 6am on Thursday, taken to a police station and strip-searched before being interviewed.
Labor said police were previously told by party lawyers that staffers were willing to co-operate with the investigation into the so-called ‘‘red shirts’’ rort. Legal action could be looming with the party reserving ‘‘all rights in these matter’’.
‘‘Conducting dawn raids on people’s homes was completely unnecessary given those involved would have co-operated if asked,’’ Victorian Labor state secretary Samuel Rae said.
The statement confirmed ‘‘a number’’ of field organisers from the 2014 state election campaign were questioned by police on Thursday. The party is providing legal assistance and will ‘‘continue to support our people’’.
Jake Finnigan, a self-described whistleblower about Labor's misuse of almost $400,000 of taxpayer funds in 2014, said police took him to their West Melbourne headquarters and forced him to strip naked, before interviewing him about claims of making a false document.
Jake Finnigan says he was strip-searched.Credit: Justin McManus
"I am co-operating with police throughout this matter, I am glad to see that this rorts investigation is finally reaching a point where things are going ahead," Mr Finnigan said.
Detectives asked Mr Finnigan to take off all his clothes, squat naked and cough while facing away from them, before having his clothes handed back and being placed in a holding cell, Mr Finnigan said.
He said the police handled the arrest "delicately" and he had no complaints with their treatment of him.
A police spokesman said it was standard practice to conduct a "full safety and evidence search" when a person was in custody and prior to being placed in a holding cell or police jail.
"This is a standard operating procedure in place at the Melbourne West custody centre and most police stations with holding cells," he said.
Victoria's Ombudsman found hundreds of thousands of taxpayer dollars were used to pay for Labor campaigners called the "red shirts".Credit: Scott Barbour
Police have made a number of arrests and interviewed several people caught up in Labor's so-called "red shirts" rorting affair.
They say they will interview 17 people across Australia as part of their criminal investigation into the scheme.
In a statement, police said they were interviewing several people in Melbourne, regional Victoria, NSW and the Northern Territory.
Those interviewed so far have been released without charge. No MPs involved in the scheme have been interviewed, although Labor's candidate for the state seat Buninyong, Michaela Settle, is reportedly among those who have spoken to police.
The Courier in Ballarat reported Ms Settle was interviewed by police on Thursday morning. Ms Settle did not respond to The Age's requests for comment. She worked as a field organiser before the 2014 election.
Mr Finnigan worked in the offices of Lisa Neville, now Police Minister, and John Eren, now Sports Minister, as part of the scheme.
He said Attorney-General Martin Pakula and Ms Neville needed to "do the right thing and resign straight away", otherwise the public could have no confidence in the police investigation.
"We shouldn't be at a point where basically the ground troops are the only people who have been arrested and taken in for interviewing," Mr Finnigan said.
"None of the management structure to my knowledge has been taken in and asked any questions. None of them have been arrested at 6am in their homes. None of them have been stripsearched in a police station."
The former Labor member also announced his intention to run in the 2018 state election, in the safe Labor seat of Footscray, as an independent candidate "on a strong anti-corruption platform to shine a light on the bad things this government has done".
The Age has contacted Victoria Police for a response to Mr Finnigan's claims about his arrest.
Victoria Police's Fraud and Extortion Squad announced an investigation last month into Victorian Labor’s misuse of about $388,000 of parliamentary funds while the party was in opposition four years ago.
Electorate officers were paid out of the public purse to campaign for Labor in marginal seats at the last state election, in a scheme the Ombudsman found breached Parliament’s members’ guide.
Under the so-called 60/40 scheme, Labor employees were paid a full-time salary out of taxpayer funds to work three days a week as electorate officers and two days a week campaigning.
Six sitting ministers in the Andrews government were named in the Ombudsman’s report as beneficiaries of the scheme, including Mr Eren, Mr Pakula, Special Minister of State Gavin Jennings, Youth Affairs Minister Jenny Mikakos, Corrections Minister Gayle Tierney and Energy Minister Lily D’Ambrosio.
The Opposition has called on the six ministers to step down.
“Police are interviewing a number of people this morning across metro and regional Victoria," a police spokesman said.
"Several people will also be spoken to in New South Wales and the Northern Territory. In total, 17 people will be interviewed by police.”
The spokesman said police would provide no further comment.
A government spokeswoman said she had nothing to add to previous comments on the investigation. However, it is understood none of those interviewed are MPs.
In March, Ombudsman Deborah Glass released a damning report into the "red shirts" rort, which she described as an "artifice".
The report found 21 MPs, 11 of them still serving, signed timesheets to field organisers who helped run the election campaign.
Ombusman Deborah GlassCredit: Simon Schluter
Ms Glass cited "a well-organised campaign by the ALP to recruit and deploy full-time field organisers in the run-up to the 2014 Victorian state election, of which 21 were employed part-time as electorate officers and paid some $388,000 out of parliamentary funds".
However, Ms Glass' report found that the MPs involved in the scheme had not deliberately broken parliamentary rules.
Labor has repaid the $388,000.
An earlier police inquiry into the rorting, dubbed Operation Peach, found it did not meet the threshold for a criminal investigation.
But police took a second look following a request from the Victorian Opposition in June.
Opposition Leader Matthew Guy said the government was in crisis and focused on itself. “Victorians deserve so much better than what they’re getting from the Andrews government,” he said.
“The government can’t sustain this any longer. Those six ministers must stand down from their positions.”
The Premier and several of his ministers cancelled events as news of the arrests broke.
Mr Guy called on the government to come forward and answer questions about the investigation.
More to come.