Former UKIP MEP Nikki Sinclaire denies charges of money laundering

The 46-year-old, who lost her West Midlands seat in May last year, also faces a separate charge of misconduct in a public office.

The former leadership candidate for Nigel Farage's party was arrested as part of a police investigation into her travel expenses in February 2012.

Yesterday, she appeared at Birmingham Crown Court where she spoke only to deny one count of misconduct in a public office and one of fraudulently transferring criminal property.

The charges relate to travel expense claims made between October 2009 and December 2010, and allegations she transferred the cash into an ING bank account between July and December 2010.

Sinclaire, who wore a black trouser suit, blue top and white scarf, was bailed to appear at the same court for a two week trial in October.

Judge Simon Drew QC told her: "I am going to adjourn your case for trial which will begin on October 19.

"I need to tell you that you must attend and if you fail to do so you will commit a separate offence and the case will continue in your absence.

"The will also be a pre trial review on October 2 that I expect you will want to attend.

"You are free to go on conditional bail."

Sinclaire, from Shirley, was elected as a UKIP MEP in June 2009 and came third in the contest to succeed Nigel Farage as party leader later that year.

But she had the whip withdrawn in 2010 for refusing to sit with the party's Italian allies Liga Nord in the European Parliament and accused the party of being homophobic.

She won a claim for sex discrimination against her former colleagues at an employment tribunal and stood for her own "We Demand A Referendum Now" party at the European elections.

Ms Sinclaire was born a male but had gender reassignment surgery on the NHS 19 years ago when she was aged in her 20s.

She did not comment as she left court yesterday morning.