The Dyfed-Powys Police Authority said in a statement that it has "accepted with regret the retirement of Chief Constable Terence Grange with immediate effect".

The move came as the Independent Police Complaints Commission (IPCC) confirmed it was investigating allegations of financial irregularities connected with Mr Grange.

The police authority statement went on: "Mr Grange had indicated that he had allowed his private life to interfere with his professional role as Chief Constable.

"This has led the Police Authority to consider the Chief Constable's position and it was considered to be appropriate to accept his retirement.

"In accepting his retirement, the Authority thanked Mr Grange for the leadership which he had brought to the force, maintaining its position as one of the best performing in England and Wales."

A statement from the IPCC said: "Although the Chief Constable has now retired, the IPCC is continuing its independent investigation into alleged financial irregularities. It would be inappropriate for the IPCC to comment further at this stage but it will make a detailed public statement in due course."

Confirmation of the IPCC investigation comes after a brief unexplained statement issued by the IPCC on Friday.

It said: "The IPCC is conducting an independent investigation into a Dyfed-Powys police officer concerning misuse of the police computer system and alleged financial irregularities. It would be inappropriate to comment further."

Mr Grange was known as one of the most outspoken Chief Constables in Wales, who took a tough line on illicit drugs. In an interview with a local newspaper he was once reported to have said that all drug barons should be "put up against the wall and shot".