GLASGOW's hosting of the Commonwealth Games was thrown into turmoil last night after the sudden resignation of the chief executive of its organising committee.
John Scott, who has been at the helm of the 2014 event for three years, offered to quit last week for breaching strict rules on accepting gifts and hospitality.
It is understood he accepted a "gift in kind" worth several thousand pounds, which he had kept secret.
Glasgow 2014 officials last night refused to discuss the identity of the firm or the nature of the offer made to Mr Scott.
The Scottish Government, which is bankrolling the majority of the cost of Glasgow staging the Games, last night said Mr Scott had done the "right and principled thing" by standing down.
The company concerned is believed to have had contracts from the Glasgow 2014 organising committee in the past few years and was described as a "potential supplier" in the statement announcing Mr Scott's resignation.
Officials insist its offer to Mr Scott has not ruled it out of future deals. It was his failure to declare the offer that breached the rules of the organising committee.
Strathclyde Police are not investigating Mr Scott in the wake of the affair.
Mr Scott has been overseeing Glasgow's preparations for the Games after arriving in August 2008 from UK Sport, where was international director and also led national anti-doping efforts.
His departure is a major blow for the event, which has a price tag of 524 million, the cost of which is being met by the Scottish Government and Glasgow City Council.
The figure has spiralled from the original estimate of 373m when the Games were awarded to the city in 2007.
However, in a progress report last month, the organising committee said its plans were "firmly on track", with work well under way on major venues such as the National Indoor Sports Arena and Sir Chris Hoy Velodrome, both near Celtic Park.
• Profile: John Scott, former chief executive of Glasgow 2014
There had been no sign of behind-the-scenes problems earlier this month when Mr Scott helped launch building work on the athletes' village at Dalmarnock.
Mr Scott's duties will be taken up on a temporary basis by his chief operating officer, American Mark Grevemberg, who had assumed more of the day-to-day responsibilities for the Games from Mr Scott over the past year.
A special board meeting called yesterday by chairman Lord Smith of Kelvin and members agreed to accept Mr Scott's resignation. It is understood that the board was not aware of the offer before Mr Scott decided to come clean.
Ironically, Mr Scott, who was responsible for leading the commercial and marketing operation for the Games, had actually been responsible for putting together the official "gifts and gratuities policy" which he went on to break.
Although Mr Scott did not comment himself about his resignation, Lord Smith said the former chief executive deeply regretted what he had done.
Mr Scott, who led efforts to secure high-profile sponsors and commercial backers for the Games, will not be receiving any pay-off from his 179,000-a-year job.
His departure has come just months after it emerged that many of Mr Scott's duties had been transferred to Mr Grevemberg, even though the chief executive was continuing to collect his full salary.
Lord Smith said: "John Scott has made an important contribution to the planning of what we believe will be an outstanding Games.
"The board has accepted his resignation for an error of judgment he made in accepting, and not declaring, an offer from one of Glasgow 2014's potential suppliers, in breach of the organising committee's strict gifts and gratuities policy.
"I know he deeply regrets this mistake and this was a job that he loved. It is a measure of the man that he has put the values and reputation of the organising committee ahead of his own at this time.
"John was largely responsible for setting the organising committee's high standards of governance and he felt he could not continue in his role as chief executive under the circumstances.
"Now we must look to the future. We have a great team in the organising committee and a strong relationship with our games partners. We are on track and on budget, and do not intend to let the pace of our preparations drop."Scottish sports minister Shona Robison said: "John Scott has made a valuable contribution as chief executive of the organising committee. He played a leading role in ensuring that the delivery of the 2014 Commonwealth Games in Glasgow remains on schedule and within budget.
"However, the reputation and integrity of our Games is paramount, and to that end I believe Mr Scott has done the right and principled thing in stepping down.
"The standards that apply in a company responsible to the public are of necessity higher than those which prevail in private business and I fully support the decision taken by the organising committee."
Councillor Archie Graham, who is responsible for the Commonwealth Games at Glasgow City Council, said: "Glasgow City Council, the Scottish Government and Commonwealth Games Scotland have a strong partnership and that is unaffected.
"We will continue to work as a team to deliver an outstanding games and a lasting legacy for Glasgow and Scotland."
Glasgow won the right to host the Games in November 2007, fighting off a challenge from the Nigerian capital Abuja, by 47 votes to 24.
At the time, First Minister Alex Salmond pledged the Glasgow Games would be "the most successful sporting event this country has ever seen".
The Games were previously held in Scotland, in Edinburgh, in 1970 and 1986.