Former MP Harvey Proctor has been left living in an out-house without running water or an indoor toilet after he lost his job in the discredited Operation Midland police, an MP has said.
Sir Gerald Howarth said his old friend has had his life turned upside down after he was caught up in a "witch hunt" by police probing allegations of a VIP Westminster paedophile ring.
The controversial 16-month probe saw raids on the homes of D-Day veteran Lord Bramall, late former home secretary Lord Brittan and Mr Proctor after claims were made by one alleged victim, known as "Nick".
All three have been cleared and retired High Court judge Sir Richard Henriques heavily criticised Scotland Yard for a catalogue of failings in the £2.5 million investigation, which closed without a single arrest earlier this year.
Sir Gerald, Conservative MP for Aldershot, told MPs during a Westminster Hall debate on the operation that Mr Proctor and his co-accused were treated in a "grotesque" way by the Metropolitan Police.
He said: "In the case of Harvey Proctor, he lost his income following his sacking by the Duke and Duchess of Rutland for whom he acted as secretary, largely at the behest of the Leicestershire Constabulary and social services.
"Loss of the job meant he also lost his home on the Duke's estate as well, and he is now living in an out-house with no running water and no lavatory facilities.
"That is the hard effect of this travesty.
"In addition, the distress caused is difficult to imagine."
While Lady Brittan had to endure the trauma of having her London and Yorkshire homes searched by police six weeks after the death of her husband.
Sir Gerald said: "Lady Brittan endured the indignity of the search of her property. As she told me, 10 to 20 officers invaded her house.
"She said it was like witnessing a robbery of your treasured possessions, including letters of condolence and photographs, without ever being told why.
"They were insensitive to her circumstances and never told her she had certain rights during the search.
"In her Yorkshire house the police asked if there was any newly-turned earth in the garden, again without saying why.
"As Lady Brittan says, whilst it was ordinary police officers who were instructed to undertake the searches, responsibility for control of this operation rests with senior police officers whose insensitivity and incompetence has been revealed."
Sir Gerald said Mr Proctor's home was raided "out of the blue" by officers who spent 15 hours trawling through his papers and possessions.
He was later accused of being a child sex attacker and murderer – claims he has now been cleared of.
Those accused of sexual offences should be given anonymity before charge and that those making the allegations should be referred to as complainants not as victims, the MP said.
This call was echoed by Tory MP Jacob Rees-Mogg (North East Somerset) who said the label victim would "fundamentally undermine the bedrock of our justice system – that someone is innocent until proven guilty".
Sir Gerald said that while complainants were given regular updates on the police investigations those accused were left in limbo not knowing anything.
He said Operation Midland amounted to a "grotesque and inexcusable failure by the Metropolitan Police" and senior officers should be held to account for the damage done.
He demanded that Met Police Commissioner Sir Bernard Hogan-Howe sign cheques of compensation to the wrongly accused and their families before he steps down in February.
Sir Gerald said Sir Bernard should authorise payments "to the real victims of this witch hunt, the people whose lives and reputations his force has shredded, and to whom they have cause immense distress" before he leaves office.
He added: "He must sign the cheques before he leaves."
And he said he is "disappointed" at the Home Secretary Amber Rudd's decision not to intervene in the saga. She wrote to Sir Gerald saying calls for compensation and the full publication of the Henriques report are operational matters for the police.
Sir Gerald said: "This is a matter of public policy, there has been a serious miscarriage of justice and ministers cannot simply stand by and wash their hands of it."
He added: "Responsibility for this scandalous failure must lie with Sir Bernard and his senior officers."
Senior Conservative MP Sir Nicholas Soames (Mid Sussex) said Mr Proctor and Lord Bramall have been "unspeakably" treated.
He said: "What comes through here is, in the case of Harvey Proctor and of others, a monstrous treatment of an innocent man who has lost his livelihood, his way of life and everything else which he had strenuously worked to re-establish his good name.
"And I believe the Metropolitan Police must put him back and recompense him for this terrible evil, and a monstrous injustice has been done and is too regularly done.
"I beg the Home Secretary and others to in some way ensure that the police exert a proper sense of proportion, common sense and good judgment in dealing with these very difficult cases."
Labour MP Simon Danczuk (Rochdale) has campaigned on child sexual exploitation for much of his parliamentary career.
He said: "The pendulum swung from a situation where police showed little interest in investigating this crime to one where, haunted by failures of the past, they became over-zealous and over-reached."
Home Office minister Brandon Lewis said he will raise the question of compensation with Sir Bernard when he seems him next week, although this it is ultimately an issue for police.
He said: "I am not, today, going to defend, and nor could I, the actions of the Metropolitan Police Service in this case.
"We the Government, we do share the deep concerns that honourable members have articulated so clearly today during the debate, and about the Metropolitan Police's handling of non-recent sexual abuse allegations including Operation Midland."
He said the Met's "credibility" in dealing with such cases has been shown to be "well below the standards" they should be.
He added: "We must not turn a blind eye to when police get it wrong and in this instance they got it wrong, and they must stand up to that."
He also criticised South Yorkshire Police for allowing the BBC to film their raid on Sir Cliff Richard's home in August 2014. Sir Cliff has lodged a damages claim at the High Court over the matter.
Mr Lewis said: "That is a great example of how to do this badly in a way that brings the entire police force into disrepute.
"The police have to understand that in order to wield the power that they have, take these investigations forward properly and appropriately, they have to understand that adage that with great power comes responsibility.
"And at what point did anybody take the view that it is appropriate to do a raid with the BBC or any media outlet in tow?"