Elections Alberta will not be investigating the arrangement between the Wildrose Party and two former Tory MLAs who crossed the floor.
CBC News learned that Wildrose Party Leader Danielle Smith had agreed to give each of their constituency associations $20,000, prior to their crossing.
Progressive Conservative Leader Alison Redford had called for an investigation into the matter on Thursday.
"There's nothing to investigate," said Drew Westwater from Elections Alberta.
Under the Election Finances and Contributions Disclosure Act, transfers within parties are permitted but need to be reported in annual financial statements.
"We're certainly aware that many of the parties do that on a regular basis and it's not an uncommon occurrence," he said.
PC leader troubled by arrangement
Westwater said the party is free to spend and send their money wherever they want, whenever they want.
"As long as they report it in their financial statements we're happy with it," he said.
But Redford says she finds it troubling and said she's never heard of this type of arrangement before.
"The idea that anyone, first of all, would change their political views based partly on financial circumstances is very troubling to me," she said.
"I think it speaks to the individuals, and I'm very concerned elections financing legislation could have been violated.
While Smith can't recall the exact details, she said there's nothing wrong with such money transfers and they're done routinely by all parties.
Money had no sway in crossing floor, says Anderson
When Airdrie MLA Rob Anderson and Fish Creek MLA Heather Forsyth left the PCs in January 2010, they said it was because they were muzzled and couldn't stand up for their constituents.
What they didn't mention was that they had struck a deal with Danielle Smith for the Wildrose Party to transfer $20,000 to their new constituency associations.
Anderson doesn't recall asking the party for the money or how the dollar amount was set, but he says it was not a condition for leaving the PCs.
"It was just part of the transition plan, so I really can't remember ... who asked for what," he said.
Anderson said later in a release it was decided the party would transfer some funds to the local Airdrie and Calgary-Fish Creek Wildrose constituency association in case a by-election or general election was called, as the two constituency associations had little money to fight an election with.
"The assertion that Heather or I crossed the floor for this money is laughable if the charge wasn’t so serious," he said.
The CBC has obtained an email sent by Anderson to the party. In it, Anderson states that there was an arrangement made with leader Danielle Smith for that money — an arrangement made prior to Anderson and Forsyth crossing the floor.
Transfer raises ethical questions, says political scientist
Political scientist Lori Williams says that while the transfers were legal, this does raise ethical questions.
"We've got someone who is saying they crossed the floor as a matter of principle but they needed money to be able to afford to do that. It certainly raises questions about whether Rob Anderson in particular had the courage of his convictions."
Williams also questions why the arrangement was struck before the MLAs defected and not revealed until now.
"If the money is in fact for a campaign, why wouldn't the money just be paid at the point when that campaign is about to launch?" asked Williams.
"Why does it have to be paid or agreed to before crossing from one party to another?"
Forsyth declined to comment.
Wildrose Party officials say there was no similar arrangement for MLA Guy Boutilier who was kicked out of the PCs and joined the Wildrose caucus after sitting as an independent.The PCs say when Bridget Pastoor crossed from the Liberals to the Conservatives last November, no financial terms were discussed.