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Top PP official resigns in Spain after corruption investigation

Popular Party (PP) candidate Esperanza Aguirre looks on during the swearing in ceremony of new Madrid mayor Manuela Carmena, 71, at Madrid's town hall, Spain, June 13, 2015. Left-wing former judge Carmena, backed by anti-austerity party Podemos, became the next mayor of Spain's capital after joining with the Socialists on Friday to end 24 years of centre-right Popular Party (PP) rule in Madrid. The victory of her left-wing alliance in the national capital is another blow to the PP after its rout in municipal and regional elections last month when austerity-weary Spaniards abandoned the party in droves. REUTERS/Andrea Comas - RTX1GC45

MADRID (Reuters) - The head of the Madrid branch of Spain’s ruling People’s Party said on Sunday she had resigned after police investigated members of her office for alleged illegal financing, the latest in a string of graft scandals involving PP.

Esperanza Aguirre, a party veteran of over thirty years, said she was not linked personally to the bribery and money laundering case, but she assumed responsibility. She said acting Prime Minister Mariano Rajoy understood her decision.

Her resignation comes at a delicate time for Rajoy, who has spent almost two months in fruitless negotiations with other parties to form a coalition government. If no government is formed, new elections may be called.

Rajoy lost his parliamentary majority in an indecisive December election, after newcomer parties campaigned against perceived deep-rooted corruption. Hundreds of politicians across Spain are currently under investigation.

“Corruption is completely killing the party,” Aguirre told a news conference at the headquarters. “The gravity of these reports, even though they are not yet validated, leads me to present my resignation.”

A Spanish judge had ordered police searches on Thursday of the offices and homes of the former head of the PP’s Madrid headquarters and of a corporate executive of Spanish builders OHL.

Last month in a separate anti-corruption investigation, police arrested 24 people, most linked to the PP, in the region of Valencia over the alleged payment of illegal commissions in exchange for public contracts.

Reporting by Miren Masides; Writing by Angus Berwick; Editing by Larry King