Labour's national campaign coordinator claimed more than £40,000 on expenses for rent on a constituency home despite owning the house next door.
Pat McFadden spent five years using the living arrangement.
The MP for Wolverhampton South East moved out of the property he owned in July 2012, just one month before expenses rules were changed. The rule change barred MPs from claiming expenses for mortgage interest.
While some people have said he broke from the "spirit of the rules", a spokesperson for McFadden said he had "complied with the IPSA rules at all times".
The MP for Wolverhampton South East moved out of the property he owned in July 2012, just one month before expenses rules were changed
PA
The MP was elected in 2005 and bought a new build home in his constituency for £159,950 the following year.
He lived in the property for six years, claiming more than £500 a month for mortgage interest.
When he moved out, after the rule change came into force, he let out his house and moved into the property next door.
He then began claiming £625 a month rent on expenses, which the rules allow for a constituency home.
In August 2015, the property he owns was advertised for £700 a month by a letting agent.
At the time, he claimed he was forced into the unusual living arrangement as a result of the IPSA rule changes. He also said he could not sell the property because it was in negative equity.
He told the Sunday Times at the time that the move was "a direct result of the change in rules for MPs’ accommodation costs" introduced in 2012.
McFadden added: "I did not want to move out of my constituency home and did not want to rent it out.
"I have not sought at any stage to get round the IPSA rules but instead to comply with them".
In total, he claimed £40,250 in rental expenses for the property. The MP sold the Wolverhampton property in 2017, for a £12,950 loss.
He also owns a house in north London, purchased in 2009 for £799,950. It is now valued at an estimated £1.74 million.
Former chairman of the committee on standards in public life Sir Alistair Graham said the living arrangements were not in the "spirit" of expenses rules.
He told the Telegraph: "All MPs have a strong personal responsibility to ensure that they keep to the minimum the amount that they need to claim from public funds."
He also said IPSA should review the rules around expenses for constituency homes to "see what was in the best public interest".
Meanwhile, IPSA said the accommodation budget is "there to ensure that MPs are not out of pocket from having to work in two locations".
Tory MP Gary Sambrook accused McFadden of "rank hypocrisy", pointing to accusations levelled at the Tories by Labour over "lavish spending" of public money.
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The MP for Birmingham Northfield told the Telegraph: "Labour’s election campaign is being run by a man who used taxpayers’ money to subsidise a tidy property portfolio, owning two houses whilst living in a third – in total contravention of the spirit of the rules.
"Once again it’s more rank hypocrisy from the Labour Party who are all too happy to point the finger at everyone and anyone, without a shred of integrity of their own."
A Labour spokesman said: "Mr McFadden has complied with the IPSA rules at all times. In 2017 he sold his property in Wolverhampton at a loss, which he paid for personally."
