The probe was launched after Prince Charles and his former close confidant were reported to police over the claims.
It is claimed that offers of financial help were made to secure honours and UK citizenship for a Saudi billionaire who had donated money to the Prince of Wales Foundation.
The pressure group Republic contacted Scotland Yard last September and reported both the future king and Michael Fawcett, Charles’s former royal valet, on suspicion of breaching the Honours (Prevention of Abuses) Act 1925.
Clarence House has previously said the prince had “no knowledge” of the alleged controversy.
Scotland Yard said in a statement: “The Metropolitan Police Service has launched an investigation into allegations of offences under the Honours (Prevention of Abuses) Act 1925.
“The decision follows an assessment of a September 2021 letter. This related to media reporting alleging offers of help were made to secure honours and citizenship for a Saudi national.
“The Special Enquiry Team has conducted the assessment process which has included contacting those believed to hold relevant information.
“Officers liaised with The Prince’s Foundation about the findings of an independent investigation into fundraising practices. The foundation provided a number of relevant documents.
“These documents were reviewed alongside existing information. The assessment determined an investigation will commence.
“There have been no arrests or interviews under caution.”
Prince Charles is president of the foundation but is not involved with its governance. Instead the charity’s trustees oversee its day-to-day activities.
Clarence House reiterated its previous statement: “The Prince of Wales had no knowledge of the alleged offer of honours or British citizenship on the basis of donation to his charities.”
A spokesperson for The Prince’s Foundation said: “It would be inappropriate to comment on an ongoing investigation.”
The charity is understood to be continuing to offer its full co-operation to the Metropolitan Police.
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