Police are questioning a member of staff at the North's Police Fund, a body established to aid widows and families of officers injured or killed during the troubles.
The suspect is being asked about terrorist and criminal activity and is being held under anti-terrorism legislation.
Two men were arrested yesterday but one was later released. The board of the Police Fund held an emergency meeting last night and vowed to assist the police inquiry.
The fund, which is based at Maryfield, near Holywood, Co Down was established on recommendation of the Patten Commission on policing reform which led to the establishment of the PSNI.
