Association of Colleges chief executive Roger Ward has been temporarily replaced following allegations of improper dealings with a lecturers' recruitment agency and a firm of financial advisers.
Confusion surrounded his departure from his post as The TES went to press. Following an emergency meeting of the AOC board to discuss his future, sources told The TES Mr Ward was "on gardening leave".
But four days after what is reported to have been "a fractious meeting", the association's press spokeswoman insisted: "He has not been suspended." But she was unable to say what had happened to Mr Ward.
Last month, The TES revealed that Mr Ward had a Pounds 650-a-month consultancy agreement with finance firm Burke, Ford Reed, and close ties with the staff agency, Education Lecturing Services, which could compromise his impartiality.
The handling of the Ward affair by the board has angered college principals and governors to such an extent that they are set to call for an extraordinary general meeting to debate a vote of no confidence.
Just 10 per cent of the membership is needed to force the hand of the board to convene a meeting, under Section 24 of the 1985 Companies Act.
However, the group behind the call for such a meeting is deeply divided over the tactics. One principal said: "Recent elections have just seen the reappointment of the board, backed by a strong APC (Association of College Principals) slate. The APC was a powerful force behind Roger Ward when he became AOC chief executive."
However, another principal said: "The board has dithered for five weeks and even now we are not sure what their decision at last week's board meeting was. I think we need a clean sweep for the sake of the AOC and the sector."
The AOC board had promised to make a statement on Mr Ward almost immediately after the emergency meeting last Thursday. But it was not until late on Monday that the following statement was issued by the board: "The board of the Association of Colleges at its November meeting referred certain allegations against Roger Ward to an independent inquiry by McKeags, solicitors, of Newcastle upon Tyne.
"It has become clear that the task of both representing the FE sector and defending himself has placed an unreasonable burden on the chief executive. Accordingly, the board has decided to ask Sue Dutton, the deputy chief executive, to act temporarily, in his place until it has received and considered the report.
"The board has nothing further to add to this statement pending the report of the independent inquiry."