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Labour leader Sir Keir Starmer has queried how the Conservative peer "end[ed] up with nearly £30m of taxpayers' money in her bank account".
Prime Minister Rishi Sunak says he "was absolutely shocked to read about the allegations" against Baroness Mone, and he said it was "absolutely right that she is no longer attending the House of Lords and therefore no longer has the Conservative whip".
Glasgow-born businesswoman Baroness Mone requested a leave of absence from the Lords "to clear her name", amid allegations she benefitted from a company she recommended for a Covid contract.
A spokesperson for the peer said: "Baroness Mone's legal team are dealing with this witch-hunt situation."