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A retired detective has told Granada Reports that senior figures within Lancashire Police - which covered Rochdale in the late 1960s - blocked investigations into Cyril Smith.
It's alleged that officers who had actually questioned Smith were ordered to leave the Liberal MP alone.
Police are to investigate claims there was a cover-up of widespread sexual abuse by the former Rochdale MP Cyril Smith at two schools in the town. The Liberal MP, who died in 2010, is alleged to have abused young boys at Knowl View and Cambridge House.
Several men say they told police they'd been physically and sexually abused by Smith in the 1960s and 70s - but no action was taken.
Cyril Smith's family deny he had any involvement in the abuse of children.
Former Lancashire police detective Jack Tasker says an investigation into sex abuse allegations against Cyril Smith was taken away from him and his colleagues.
Former Lancashire detective Jack Tasker believes that if Cyril Smith "would've admitted" abusing boys at Cambridge House, if he'd been taken to trial.
Tasker interviewed the former Rochdale MP in 1969.
The Rochdale MP Simon Danczuk says he wants an independent inquiry into whether Rochdale Council knew about Cyril Smith's abuse of children, and what action they took.
Smith died in 2010 aged 82, he was an MP from 1972 to 1992. His family have always denied he had any involvement in child abuse.
Rochdale Council has announced a formal investigation into their decision making in relation to sexual abuse at Knowl View.
They instructed new QC, Neil Garnham to carry out the review alongside Greater Manchester Police.
They said considerable progress had been made in terms of identifying potential witnesses and expect there will be a report by the end of July 2014.
The council said an independent review of all information available to the council suggests that between 1961 and 1995 sexual abuse of children took place at premises owned by the council.
The review aims to find out whether there was a pattern of abuse and whether the abuse of children was tolerated, facilitated or promoted by the council and if there was a culture which inhibited the prevention of abuse.
The investigation into sex abuse at Knowl View School in Rochdale, linked to the dead MP Cyril Smith, will widen the scope of its review to consider the allegations of abuse, and the town council's reaction to them.
Leader of Rochdale Council Colin Lambert appeared with Sir Peter Fahy, Chief Constable of Greater Manchester, who appealed for victims to come forward and said police trying to trace 'a significant number' of victims.
Chief Constable Fahy also said police have a 'number' of suspects, but have made no arrests at the moment.
Police said these cases are 'extremely difficult' and take time, but his force were determined to carry out a thorough investigation.
The review into abuse allegations at Knowl View in Rochdale will examine if there was a "culture of abuse" at the school.
Rochdale Council is to 'widen the scope' of its investigation into historical sex abuse at Knowl View school.
The leader of Rochdale Council Colin Lambert is appearing with Greater Manchester Police Chief Constable Sir Peter Fahy at a press conference in to the alleged cover up of abuse at the school, linked to the late Rochdale MP Sir Cyril Smith.
Latest ITV News reports
Police are investigating allegations that the former MP for Rochdale sexually abused boys at homes and hostels in the town.