The prospective Labour parliamentary candidate at the centre of selection-fixing allegations in Falkirk has quit the race.
Labour leader Ed Miliband has turned on the trade union Unite - his biggest financial backer - whose votes helped him become leader.
Tom Watson has announced his resignation from the shadow cabinet, amid a row about the influence of the union Unite on the Labour party.
The trade union Unite remained Labour's largest donor in the third quarter of 2013, despite its public spat with the party leadership over the selection of an election candidate in Falkirk.
Unite gave Labour £777,740 between July and September, almost a quarter of the party's total donations of £3,157,761, according to official figures.
Conservatives received the most donations in the three-month period, with a total of £3,275,185, while Liberal Democrats took in £98,408, said the Electoral Commission.
Labour launched an internal inquiry in July into allegations that Unite had tried to fix the Falkirk selection for its favoured candidate, but the investigation was closed in September after finding no evidence that rules were breached.
Unite the union is to launch a new credit union, open only members, to take on payday lenders such as Wonga.
“We are determined to wipe out rip-off payday lenders and ensure that they can’t make profits by exploiting victims of the financial downturn," Unite general secretary Len McCluskey said.
"Unite's new credit union service ensures our members can access finance without fear and helps keep them out of the clutches of parasitic lenders."
Credit unions are not-for-profit organisations offering loans, savings and current accounts to their members.
More: Who can join credit unions and how do they work?
One of the unions supporting university staff in their second strike over pay next month has said "enough is enough".
Michael MacNeil, UCU's head of higher education, said: "Staff have suffered year-on-year cuts in the value of their pay and have made it clear that enough is enough.
"We remain committed to trying to resolve this dispute and the employers now have until 3 December to sit down and positively engage with the unions.
"If they don't, then our members and those from our sister unions will be out on strike again, as well as continuing to work to contract."
University academics and support staff will stage a second strike over pay in December, with unions claiming staff are receiving pay cuts in real terms.
UCU, Unison and Unite, all of which took part in a one-day walkout on October 31, will be joined by Scottish education union EIS on December 3.
The dispute centres on a 1% pay rise offered to university staff - including lecturers, technicians and administration workers - which the unions insist means there has been a 13% pay cut in real terms since October 2008.
But the Universities and Colleges Employers Association has said that, on top of the 1% general pay rise, many university staff get other contributions which will increase pay by 3% overall.
Ed Miliband has promised his party will look into any new evidence regarding allegations of vote-rigging in Falkirk, but refused to comment on whether the inquiry would be reopened.
The Labour leader admitted there were "machine politics" at play in Falkirk, but insisted his party are "learning the lessons" from the scandal.
The Party's former chancellor, Alistair Darling, has suggested that the issues around the contest in the constituency should be looked at again.
Conservative Party chairman Grant Shapps has backed calls from former Labour chancellor Alistair Darling to reopen the inquiry into the Falkirk vote-rigging scandal.
In a statement, Mr Shapps said: "Alistair Darling is the latest senior Labour figure to blow the whistle on Unite's shadowy tricks in Falkirk.
"Union bosses up there have been pushing Ed Miliband around, fixing Labour seat selections, intimidating families and their young children, and signing up people as Labour Party members without their knowledge.
He added: "Ed Miliband has been totally silent about this ever since he caved in and cancelled Labour's inquiry. If Ed Miliband is too weak to stand up to his union paymasters, then he is too weak to stand up for hardworking people."
Unite the Union have denied any wrongdoing by members throughout the candidate selection process in the Falkirk by-election earlier this year.
"Specifically, Unite entirely denies any involvement in or knowledge of the forging of signatures on application forms or of any documents whatsoever; the coercing of individuals to join the Labour party.
"Unite called for an independent public inquiry into what happened in Falkirk, and we remain entirely happy to assist such an inquiry, and draw appropriate lessons from it if necessary, should one be established."
Labour's refusal to reopen its inquiry into the Falkirk vote-rigging row comes as the Party's former chancellor Alistair Darling and Scottish Labour leader Johann Lamont suggested that the issues around the contest in the constituency should be looked at again.
"Something has gone very wrong in Falkirk. There needs to be a very thorough investigation," Mr Darling said in a television interview.
"I understand the police are looking at matters now.
He added: "If they proceed, then that is what'll happen but if they don't there needs to be a full inquiry and I am quite clear that the results have to be published because that is the only way in which people will be satisfied that justice is done and been seen to be done."
A party spokesman said Lorraine Kane had been asked about quotes in the Daily Mail suggesting she had not intended to retract her complaint about alleged irregularities in the candidate selection process.
However, she confirmed that she stood by the sworn statement given to the party's probe in September, according to the spokesman.
– Labour spokesman
It was that affidavit which was part of the reason that led the Labour Party to conclude there was insufficient evidence to proceed with our inquiry.
Therefore we have not seen any new evidence to justify further action.