The parliamentary authorities have called in Scotland Yard after the deputy speaker of the Lords was caught on video allegedly taking drugs with prostitutes.
Lord Sewel quit his £84,500 a year role - which included overseeing conduct issues in the Upper House - after the dramatic expose by The Sun On Sunday.
Even if police take no further action, he risks becoming the first peer expelled from parliament under tough new rules that he himself helped introduce.
The newspaper's footage shows Lord Sewel romping naked with two women at his flat in Dolphin Square, Pimlico, a couple of miles from parliament.
At one point he snorts white powder - alleged to be cocaine - from one prostitute's breasts using a five-pound note.
The 69-year-old apparently paid one of the women for the night with a cheque for £200, dated July 22.
Lord Speaker Baroness D'Souza branded the married peer's behaviour "shocking and unacceptable" and said she was referring him to the police.
"Today's revelations about the behaviour of Lord Sewel are both shocking and unacceptable. Lord Sewel has this morning resigned as chairman of committees," Lady D'Souza said in a statement.
"The House of Lords will continue to uphold standards in public life and will not tolerate departure from these standards.
"These serious allegations will be referred to the House of Lords Commissioner for Standards and the Metropolitan Police for investigation as a matter of urgency."
The House of Lords (Suspension and Expulsion) Act 2015 - which only received Royal Assent in March - allows peers to be barred from parliament if they breach a beefed up code of conduct.
The code maintains that members must "always act on their personal honour".
The Lords Commissioner for Standards Paul Kernaghan, a former police chief constable, will gather evidence on whether there has been any misconduct.
The cross-party Lords Privileges and Conduct Committee - which Lord Sewel chaired until the scandal broke - will then decide on a punishment.
Earlier this month, Lord Sewel wrote an article on the new rules that stated: "Scandals make good headlines. The requirement that members must always act on their personal honour has been reinforced."
Police sources indicated they would assess the evidence after the referral from Baroness D'Souza, but pointed out that drug-taking allegations were notoriously difficult to prove when there was only video evidence, rather than substances that could be tested.
In between apparently snorting lines, Lord Sewel is heard complaining that he struggles to afford the £1,000-a-month rent on the flat.
The peer is asked whether he receives expenses and explains that he now gets a flat-rate allowance of £200 a day. "It's all changed and disappeared. People were making false claims," he said.
"Members of her Lordship's House who are right thieves, rogues and b*****ds at times. Wonderful people that they are."
In fact, the per diem for attending the Lords is £300, and it did not apply to Lord Sewel. As he declares his main residence is in Aberdeen, he was entitled to a tax-free office holder's allowance of £36,000 a year.
Labour MP John Mann insisted Lord Sewel should retire from the Lords voluntarily before he is expelled.
"He chaired the committee that makes the decisions on discipline. It was his committee," the Bassetlaw MP said.
"He cannot possibly go in front of his own committee and expect a serious hearing.
"He is a disgrace. He should retire and resign immediately.
"A lifetime ban would be the committee's only option. He needs to save them and himself further embarrassment and go now."