The prosecutor's office in Geneva said on Wednesday that it had frozen assets in Switzerland worth millions of dollars belonging to Khayam Turki, a senior figure in Tunisia's left-wing Ettakatol party -- an ally of Islamist party Ennahda, the dominant force in government.
But Turki called the reports "rumours" and dismissed them as a plot to destabilize his party.
"I don't have funds in Switzerland that could be frozen," he said in a statement.
Turki, Ettakatol's treasurer during the campaign for Tunisia's October 23th elections, said he had a "derisory sum not greater than 5,000 euros" ($6,300) in Switzerland.
He threatened to take action against those responsible for the reports, but did not give details.
Turki is suspected of embezzling funds from his time as director of the Abu Dhabi-based Emirates International Investment Company (EIIC), according to Swiss news agency ATS.
He had been tipped to become finance minister in late 2011 after the elections that followed the overthrow of former president Zine El Abidine Ben Ali, but removed his name from consideration after the embezzlement allegations emerged, ATS said.