New Jersey governor Chris Christie is being investigated for allegedly wasting $2.2mn of relief funds on ads starring him and his family, US auditors said.
If proven, the claims could affect Christie's presidential ambitions, already reeling over a recent political revenge scandal involving one of his aides.
Already cornered in a scandal over snarled traffic at the George Washington Bridge, Christie is now being audited by the Inspector General at the US Department of Housing and Urban Development (HUD), an agency spokesman said on Monday.
The inspector is focusing on a federally financed $25m Jersey Shore marketing campaign that included a television commercial featuring Christie and his family.
The probe also includes Christie's decision to award a $4.7m contract – $2.2m more than a lower bid that did not propose featuring the governor in the ads.
Christie, considered an early 2016 Republican contender for the White House, was credited with decisive leadership when the devastation of Hurricane Sandy slammed into the East Coast in 2012.
The probe began after HUD "received a request from Congress," the spokesman said.
New Jersey Congressman Frank Pallone Jr., a Democrat, told the press on Monday that he reported the alleged fund misuse to HUD.
Pallone said he is concerned the money was "manipulated" to support Christie's re-election campaign and welcomed the audit. "I commend the HUD office of the inspector general for investigating whether the state properly utilised taxpayer funds for this marketing campaign," Pallone said.
He has alleged that the cheaper bid would have saved $2.2m in federal disaster aid, which could, for example, have provided 44 Sandy-affected homeowners with $50,000 grants.
"We had to fight hard to get the Sandy aid package passed by assuring others in Congress the funding was desperately needed and would be spent responsibly," said Pallone.
His office said the audit was expected to last several months and would culminate in an official report.
The television commercials were supposedly aired to promote tourism on the reconstructed Jersey shore.
Christie’s office told US media that there was nothing unusual about the ads or how they were paid for. "Federal agency reviews are routine and standard operating procedure with all federally allocated resources to ensure that funds are distributed fairly. We're confident that any review will show that the ads were a key part in helping New Jersey get back on its feet after being struck by the worst storm in state history," the statement read.
Christie was forced to sack a staffer who in August worked to block lanes on a major bridge, allegedly in an act of retribution against a Democratic mayor who refused to endorse Christie for a second term.
The governor is also facing a lawsuit over the massive traffic jams. He has apologized repeatedly and said he was unaware of the alleged dirty tricks, unveiled in news reports last week.