The leader of Italy's Northern League party Umberto Bossi resigned on Thursday over a mounting fraud scandal, local media reported.

Bossi, who said his decision to quit as the rightist party secretary was "irrevocable", was suspected of being linked to probes into alleged frauds by former party treasurer Francesco Belsito.

Aftre the resignation Bossi still kept his title as the president of the party.

Belsito was put under investigation for alleged investments in Tanzania made with the League funds, and money laundering in the southern cities of Reggio Calabria and Naples along with people belonging to organized crime.

Prosecutors in Milan also suspected that money for election reimbursement was partly misspent on perks for Bossi's children including home renovation, travel and dinners.

The League, which demands greater autonomy for wealthier northern regions, was the leading political ally with former prime minister Silvio Berlusconi until he resigned last November.

Bossi's party was also a highly vocal opponent of Prime Minister Mario Monti's emergency cabinet of non-political technocrats.

The scandal hitting the League, which claimed to be a "crystal transparent" and anti-corruption party, shocked supporters who gathered at the headquarters in Milan to ask for clarification, local media said.

Last month a senior League member Davide Boni, president of northern Lombardy regional council, was also put under investigation for alleged frauds along with several other council members.

Recent corruption scandals have involved representatives on all sides of the Italian political landscape from the center-right People of Freedom party to the center-left Democratic Party.