Police said they were investigating potential offences under laws governing donations to political parties, which could include concealment of the source of funding or giving false information to the treasurer of a party.
"An investigation was launched in February 2025 after a referral was made to the Metropolitan Police by the Electoral Commission relating to donations made to a political party ahead of the 2024 UK general election," a spokesperson for London's Metropolitan Police said.
Two people had been questioned but no arrests have been made, police said, without confirming the names of those involved in the donations under investigation.
Farage has been facing questions for weeks about his party's funds and his financial affairs, including undisclosed gifts from a cryptocurrency billionaire investor and Cottrell, who was convicted of fraud in the United States.
Farage has repeatedly denied any wrongdoing, saying he received the donation from the crypto investor before announcing his candidacy in the 2024 election, and therefore did not need to declare it.
The Times said the police investigation was looking at payments made by Fiona Cottrell, the mother of George Cottrell, to Reform before the 2024 election.
Cottrell, a long-standing political ally, went to prison in the US in 2017 after pleading guilty to wire fraud and now works in cryptocurrency.
Farage, a campaigner for Brexit, abruptly announced on Tuesday that he would resign his parliamentary seat and run there again, seeking a vote of confidence from voters to answer criticism about his finances.
