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MPs have approved a motion to suspend Blackpool South MP Scott Benton from the Commons for 35 days.
Mr Benton's suspension exceeds the 10-day threshold that triggers a recall petition and potentially a by-election.
The ex-Tory, who is now an independent, broke Commons rules when he was caught by the Times offering to act on behalf of gambling investors.
An independent panel upheld a decision by the Standards Committee, which Mr Benton had appealed against.
It said there had been "no procedural flaw" in the process.
Mr Benton has previously said he was "deeply disappointed" and claimed there had been a "lack of integrity" throughout the process, which was "prone to regular leaks at every stage".
He said he has continued to serve his constituents.
The motion means Prime Minister Rishi Sunak faces the prospect of another difficult by-election.
Undercover reporters caught Mr Benton breaching Commons rules by offering to lobby ministers and table parliamentary questions on behalf of gambling investors.
He was elected as a Conservative in 2019 with a 3,690 majority but currently sits as an independent.
Voters will have six weeks to register their support for Mr Benton's removal, with a 10% threshold needed to trigger a by-election.
The returning officer will issue details of venues in the constituency where they can support the recall.
Labour has urged Mr Benton to resign as an MP completely.
A Blackpool South by-election would be the fourth this year, while defeat would be the 11th time the government had lost a seat since the start of the current Parliament in 2019.
Any poll would be unlikely to occur until the end of April or the beginning of May.
The BBC has contacted Mr Benton for comment.