The U.K.'s Electoral Commission on Wednesday announced an investigation into allegations that Prime Minister Boris Johnson had Conservative Party donors "secretly pay" for a renovation of his apartment at No. 11 Downing Street.

Why it matters: It's unprecedented for a sitting prime minister to face this kind of investigation, which could result in a fine of up to £20,000 and a referral to police if the violations are serious, according to The Times of London.

What they're saying: “We have been in contact with the Conservative Party since late March and have conducted an assessment of the information they have provided to us," the Electoral Commission said in a statement.

• "We are now satisfied that there are reasonable grounds to suspect that an offence or offences may have occurred. We will therefore continue this work as a formal investigation to establish whether this is the case."

Background: Prime ministers receive an annual public grant of £30,000 to renovate their homes, but there was speculation that Johnson and his fiancée spent as much as £200,000 on a luxury refurbishment — which Downing Street insists was paid for out of their own pocket.

• It is not illegal for prime ministers to accept loans or donations, but they must be publicly declared within 28 days.
• In response to questions about the funding of the apartment, Johnson said: "If there's anything to be said about that, any declaration to be made, that will of course be made in due course."

The big picture: The allegations became much more serious when Dominic Cummings, Johnson's controversial former top aide, claimed he told the PM that his "plans to have donors secretly pay for the renovation were unethical, foolish, possibly illegal and almost certainly broke the rules on proper disclosure of political donations if conducted in the way he intended."

• Cummings, considered one of the chief architects of the Brexit campaign, ended his tumultuous tenure at Downing Street after falling out with Johnson over staffing issues last year.
• His allegations about the apartment are part of a broader leak scandal that includes reports that Johnson said he'd rather let "bodies pile high in their thousands" than impose another coronavirus lockdown in England.