Hong Kong officials have arrested four people from the scandal-hit Ting Wai Monastery, whose abbess has been accused of extravagant spending, mishandling donations and engaging in fake marriages.
Local media identified one of the four as Sik Chi Ding, the nun in charge of the Buddhist temple.
The arrests, carried out by officials from the Immigration Department, came a day after volunteers at the monastery held a news conference accusing the nun of misconduct.
The abbess, who took charge of the temple in 2005, said in a statement that she had been co-operating with the police since September and had turned the matter over to her lawyer.
The case has thrown a spotlight on financial management among Hong Kong charities, which regularly attract tens of millions of dollars in donations every year.
Mary Jean Reimer, who sits on the board of directors at the monastery, went public with the allegations.
Ms Reimer, a Buddhist and a high-profile former actress, has told BBC News that she began donating to and volunteering at the temple in March.
"It was in financial trouble and the main structure was about to collapse. I was told the monastery couldn't afford to pay for electricity," she said.
But soon, she said, she began to suspect financial mismanagement.
Ms Reimer claimed the abbess had extravagant tastes, wanting HK$30,000 ($3,870; £2,520) a month to pay for personal food expenses and another HK$7,000 to feed her two dogs.
"She refused to eat local vegetables. She didn't want to eat normal apples that cost HK$4 each. She wanted imported apples from Japan that cost HK$100. She went to five-star hotels for high tea," said Ms Reimer.
She also accused the nun, originally from mainland China, of improperly taking donations meant for temple renovations and placing them into a bank account earmarked for expenditures.
"A lot of the donations came from people from humble backgrounds, like farmers living nearby. It is money they have worked very hard to make. They donated money to the monastery, not to support personal spending habits," she added.
Because of the discord, Ms Reimer said the volunteers began investigating the abbess.
They claimed that they found she had broken her vows by being married twice, in 2006 and in 2012, to two different monks from mainland China.
Ms Reimer has quoted the nun as saying she had married the men so they could legally emigrate to Hong Kong.
Local media report that both men currently serve the well-known Po Lin Monastery, which is famed for drawing tourists with a giant bronze Buddha statue.
The Immigration Department has confirmed that two of the people arrested were suspected of giving false statements to officials.
Local media have shown photos of two confiscated mainland Chinese marriage certificates.
Ms Reimer acknowledged that the allegations may damage the image of Buddhism in Hong Kong.
"I really struggled with my decision," she said. "But maybe this is time for change. The mismanagement of Hong Kong charities is not a new thing. They are not subject to any government supervision."
The Hong Kong Buddhist Association has not responded to a request for comment from the BBC.
But at least four government bodies, including the Home Affairs Bureau, the office of the Financial Secretary and the police, have promised to look into the case.