The British government was dealt another setback on Tuesday with the resignation of Tulip Siddiq, the minister in charge of financial services and anti-corruption efforts, due to scrutiny over her financial connections to her aunt, Sheikh Hasina, the former Prime Minister of Bangladesh.

Siddiq, who consistently denied any wrongdoing, resigned amid growing questions about her family’s involvement in corruption-related activities in Bangladesh.

Her resignation marks the second government minister to leave office in two months, further challenging Prime Minister Keir Starmer’s leadership.

Although Prime Minister Starmer had previously expressed confidence in Siddiq, her exit raises concerns about her family’s financial dealings, particularly in connection with the investigation into Hasina’s alleged corruption in Bangladesh.

The 42-year-old former minister was appointed in July after Labour’s general election win, with responsibilities including overseeing financial services policy and anti-money laundering measures.

However, issues arose due to her family's close ties to Hasina, who led Bangladesh for over a decade before being ousted last year amid protests.

Siddiq’s involvement in the investigation became more prominent after her name was linked to alleged financial irregularities tied to a $12.65 billion nuclear power contract in Bangladesh, from which she and her family were said to have potentially benefitted.

Living in properties associated with Hasina’s supporters, Siddiq referred herself to the government’s ethics adviser as the controversy intensified.

Though the adviser concluded that Siddiq had not breached ministerial conduct rules, he noted that she failed to recognize the reputational risks of her family’s involvement in the Bangladesh investigation.

In a letter to Starmer, Siddiq admitted that her continued role as minister could distract from the government’s work.

Shortly after her resignation, Starmer appointed Emma Reynolds, the former pensions minister, to succeed Siddiq.

The controversy around Siddiq’s resignation also highlights ongoing investigations into Hasina’s administration, where she faces allegations of corruption and money laundering.

The former prime minister and her party have denied the accusations.

Siddiq’s resignation follows that of Transport Minister Louise Haigh, who stepped down late last year after admitting to a minor criminal offense related to a phone reporting incident before taking office.