MONTREAL - Allegations levelled at the Conservative Party by Elections Canada suggest the Tories "cheated" in the last federal election campaign, Liberal Leader Stephane Dion said Monday.

Accusing the Tories of an attempted cover-up, the federal Opposition leader called on Prime Minister Stephen Harper to explain the actions of his party.

"The allegation is that the Conservative Party cheated at the last election, the Conservative headquarters of the campaign cheated at the last election, tried to cover it up after and (were) caught," he told reporters in Montreal on Monday.

A search warrant related to a raid on Conservative headquarters accuses the party of making "false and misleading" statements in their financial returns for the last election.

The warrant also says the Conservatives exceeded election spending limits by $1 million.

Dion told reporters in Montreal the money could have influenced the outcome of the January 2006 election, which saw the Grits ousted from power.

"Yes, it may have had an effect," Dion said. "We'll never know for sure, but you don't cheat for nothing. You cheat because you want to have an effect. You want to have more voters for you in an illegal way."

Dion was joined by other opposition leaders Monday at a news conference where renovation plans were unveiled for a Montreal food bank.

Like Dion, they attacked Harper and the Conservatives over the party's handling of campaign financing in the last election.

NDP Leader Jack Layton called Elections Canada's allegations "very, very serious."

"It appears after 20 years of ethically challenged government, we've got a party that apparently spent as much as a million dollars more than they were supposed to on advertising," Layton said in an interview.

"That doesn't make for a level playing field and a fairness in elections."

The Tories have denied they've done anything wrong and say they were surprised when the RCMP raided their offices last week at the request of Elections Canada.

They attempted to put a more favourable spin on the issue by selectively releasing parts of the sealed search warrant on Sunday to hand-picked reporters in Ottawa.

The Canadian Press was not invited to the meeting but obtained the information elsewhere.

The warrant was to be unsealed by the court on Monday.

Bloc Quebecois Leader Gilles Duceppe called Harper a "control freak" over the engineered leak.

"It shows the real nature of Stephen Harper," Duceppe said.

"It's a contempt of Parliament... this is a control freak, the old Reformist Stephen Harper is reappearing, the real nature of Stephen Harper is clear now."

Duceppe said the handling of the controversy fits into a "an extremely dangerous" pattern of Tory attempts to manipulate the public.


A look at allegations made about Tory spending in the last election

OTTAWA - A primer on the alleged misconduct of the federal Conservative party in the last federal election:

WHAT - Elections Canada alleges that the Conservative party organized a program to allow it to spend more on election ads than allowed under the rules through an "in-and-out" scheme. This program shifted $1.3 million in expenses to 67 local candidates who had room under election spending limits to pay for advertising, but didn't have the cash.

WHO - The elections watchdog says the party sent the money to these individual campaigns, which then sent it right back, supposedly as a payment for regional ads. But the money actually was spent by the party on national ads, Elections Canada alleges.

HOW - The agency says the party transferred money to 67 campaign bank accounts "and within a very short span of time, these funds or funds closely approximating the amounts deposited, were transferred back out of these accounts."

WHY - The elections watchdog says this plan allowed the national party to overspend its legal limits by about $1.1 million. And 65 of the 67 the individual campaigns involved got to claim 60 per cent reimbursement from the government for the phantom ad money that just passed through their bank accounts. The other two campaigns didn't get enough votes to qualify for reimbursements.

PENALTIES - Elections Canada alleges that the program violated a number of sections of the Elections Act. Convictions could bring a maximum penalty of up to five years in jail and a $5,000 fine for the financial agents involved and a $25,000 fine for the party. Most violations of the act bring fines, usually $2,000 or less.