Ministers have been urged to suspend welfare-to-work contracts with a company at the centre of allegations of fraud.
Thames Valley police visited the offices of A4e in Slough, Berkshire, on Friday in connection with the claims.
The company said they concerned a "very small" number of former employees whose activities had been referred to police by A4e.
But the Labour MP Margaret Hodge, chairwoman of the public accounts committee, said the government should consider suspending its Work Programme contracts with A4e until the matter was resolved.
"I think the government should certainly consider suspending them. It is of great concern that any such investigation is necessary," she told the Daily Mail.
Hodge has recently attacked A4e's performance record as "abysmal".
The company is chaired by Emma Harrison, who was appointed by David Cameron in 2010 to help get troubled families into work.
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Ministers urged to suspend welfare-to-work contracts over fraud claims.
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