Ms Sudmalis, the seat’s incumbent Liberal MP, reportedly told colleagues at a party room meeting in Canberra on Monday that she had won a booth because one of her supporters had taken the Labor material and stashed it in a car boot. 

The MP, who clung on to retain the seat despite a 3 per cent swing against her, was speaking about the effect of Labor’s Medicare campaign at the time.

The comment has riled those in the Labor Party, including the party’s candidate for Gilmore Fiona Phillips and the NSW Labor general secretary Kaila Murnain. 

The party has referred the incident to Shoalhaven police, with Ms Murnain having also asked Electoral Commissioner Tom Rogers to investigate.   

“It was surprise to me, what was said, but it doesn’t surprise me that it happened to be honest, or allegedly happened,” Mrs Phillips told the Mercury. 

“I don’t know what else you can say, to be honest.

“I’m just obviously looking forward to the matter being investigated and I’d really like my material back, it’s not like we have heaps and heaps of it.”   

The Commonwealth Electoral Act states “hindering or interfering with the free exercise or performance by any other person of any political right or duty relevant to an election” carries a $1000 fine or six-month jail term, or both. 

The Mercury contacted Ms Sudmalis for comment on Tuesday.

The MP earlier told the ABC her party room comments were based on an anecdote from her campaign.

“That was a story that came out yesterday [Monday] and make of it what you will,” she said.

“It was an observation that was given to me, whether it was factual or not I don’t know, I was just repeating the story that was given to me.”

Asked if she knew who did it, she said: “No. No, no, no, That’s the sort of thing that you don’t ask the detail for.” 

Questioned whether she condoned the behaviour, Ms Sudmalis said: “You don’t touch other people’s stuff”.

“Even though I’m appalled by what they did, I wouldn’t touch it,” she said. 

If she did know who they were, the incumbent stated she would “talk to them quietly and say ‘that’s not an appropriate action to take’. 

An AEC spokesman acknowledged receipt of a letter from Ms Murnain.

“The AEC has considered the letter from the ALP and formed the view that the allegations referred to do not raise any prima facie breach of the requirements of the Commonwealth Electoral Act,” he said. 

The spokesman said a previous Federal Court decision related to the appropriate section of the Act “concluded that this does not cover the removal of campaign signs”.

Earlier this month, Ms Sudmalis slammed Labor and the unions for their election-day campaigning, telling the Mercury the “intimidatory tactics were completely out of place in Australian politics”.

At the time, Ms Sudmalis said she was against the Construction Forestry Mining Energy Union (CFMEU) and GetUp campaigns, along with Labor’s “Mediscare” push, but didn’t know if they could be attributed to the swing against her at the polls.

“Handing out a Medicare card to people who are clearly completely confused by it, saying ‘what’s this for?’, [and then replying] ‘that’s what the government’s going to take away from you’ - you have got to be kidding,” she told the Mercury on July 7.

“It was just blatant lies and it was frightening for people.” 

On Tuesday afternoon, Ms Sudmalis held a 1360-vote lead over Mrs Phillips on a two candidate preferred basis.