NSW Labor MP Shaoquett Moselmane is being questioned in his parliamentary office after the Australian Federal Police and ASIO raided his home and office in Sydney on Friday.
NSW Labor leader Jodi McKay confirmed she was aware of the raids, and that the party would suspend Mr Moselmane’s membership.
The AFP confirmed search warrants had been executed in Sydney as part of an ongoing investigation and that there was no threat to the community.
Federal police raided properties linked to Mr Moselmane, looking for evidence to support allegations of a Chinese government plot on Australian soil.
Mr Moselmane was being questioned in the presence of the clerk and his lawyer.
Ms McKay said Labor was cooperating with the agencies involved.
Reports emerged in 2019 that Mr Moselmane had hired a staffer with links to the Communist Party of China.
In April, Mr Moselmane praised Chinese leader Xi Jinping for his “unswerving leadership” in responding to the COVID-19 pandemic.
Ms McKay subsequently the comment as “inappropriate”.
Mr Moselmane was subsequently stood down as assistant president of the NSW upper house.
On Friday, Ms McKary said she’d been told authorities including ASIO officers entered Mr Moselmane’s Rockdale home and had a warrant for his office.
Ms McKay was to be briefed by law enforcement agencies later on Friday.
“It’s dreadfully concerning, it’s terrible,” she said, adding one of Mr Moselmane’s staff might also be involved.
“There’s an expectation on MPs that, whatever they do, it’s in the best interests of the people of the state.
“I’d hope every single MP in the parliament – not just on the Labor side but the Liberal and National Party side and crossbench – has that at the heart of their actions.
“I’m very restricted in what I can and can’t say.”
Prime Minister Scott Morrison said he was aware of an investigation that has been going on for some time.
“It’s elevated to a new level today,” he said in Canberra.
“The need to take action is necessary and the government is absolutely determined to ensure that nobody interferes with Australia’s activities.
“We won’t cop anyone coming and seeking to interfere in our political system.”
Federal Attorney-General Christian Porter said on Friday that espionage and foreign interference threaten Australian national security.
“It is worth saying that the government is sharply focused on activity in this area as evidenced by the complete rewrite of the laws applying to espionage and foreign interference and also foreign influence,” Mr Porter said in a statement.
Mr Moselmane has been a member of the NSW upper house since December 2009 and between 1995 and 2009 served four stints as Rockdale City Council mayor.