Donald Trump’s former national security adviser, Michael Flynn, is under investigation for involvement in a plot to kidnap a Turkish dissident cleric living in the US and fly him to an island prison in Turkey in return for $15m, it was reported on Friday.

The report in the Wall Street Journal is the latest of a string of allegations facing Flynn, a retired general and former head of the Defence Intelligence Agency (DIA).

Robert Mueller, the special counsel investigating Russian manipulation of the 2016 US election, has already indicted Trump’s former campaign manager Paul Manafort and another senior fundraiser on charges including money laundering. A former foreign policy adviser has pleaded guilty to perjury.

Mueller is now reported to have gathered sufficient evidence to bring charges against Flynn and his son, Michael Flynn Jr, which would bring his investigation another leap closer to Trump.

The fact that no indictment has been made public may only increase concerns for Trump’s legal team. Flynn has expressed interest in an immunity deal and Mueller, in his dealings with former foreign policy adviser George Papadopoulos, has shown himself ready to negotiate.

The former national security adviser’s company, Flynn Intel Group, is under scrutiny for failing to register work it did for interests linked to Turkish president Recep Tayyip Erdoğan, and Flynn is in legal jeopardy for his statements to investigators about his contacts with representatives of the Turkish and Russian governments.

The new allegation, that Flynn and his son engaged in a conspiracy to arrange the rendition of Fethullah Gülen to the Erdoğan government – which accuses the cleric of plotting an abortive coup in July 2016 – could if confirmed result in even more serious charges.

In September, the Wall Street Journal reported a meeting about the plan, in which former CIA director James Woolsey participated. Friday’s report describes a second meeting involving both Flynns at the 21 Club restaurant, a prohibition-era New York speakeasy patronised by Trump, in mid-December. According to “people familiar with the investigation”, it was at this encounter that the $15m payment was discussed.

One source said Gülen would be seized and flown by private jet to the Turkish prison island of Imrali. It is not clear if any money changed hands or if any preparatory steps were taken.

The timing of the 21 Club meeting is significant. The White House has distanced itself from the men charged by Mueller – Papadopoulos, former campaign manager Paul Manafort and his business associate Rick Gates. But by mid-December Trump had named Flynn national security adviser and he was playing a central role in the transition.

That period is a grey area when it comes to paid work for foreign interests, but if the arrangement was carried through past inauguration in January, Flynn could face bribery charges on top of questions of whether the New York conversations represented a conspiracy to carry out a forced extra-judicial rendition of a legal US resident.

“If the facts involving Flynn and his son are true, or even mostly true, it indicates an incredible propensity for outrageously illegal conduct,” said Ryan Goodman, a New York law professor and former Pentagon counsel. “Evidence that Flynn was prepared to act in such an unlawful way could help prove a case against him in other activities as well involving his ties to Russia during the campaign.

“If Mueller has sufficient evidence that Flynn and his son were involved in this audacious plot to kidnap the cleric, the special counsel can use that to pressure the former Trump campaign associate to flip and tell the FBI everything he knows of relevance to the Russia investigation.”

The White House did not respond to a request for comment. Nor did the attorney representing the elder Flynn, Robert Kelner. Barry Coburn, representing Flynn’s son, said he had no comment.

The Alliance for Shared Values, a group representing Gülen supporters in the US, said: “The US justice system should be commended for not giving in to the Turkish government’s campaign against Mr Gülen, no matter how nefarious a plan the Erdogan regime could concoct nor how much money it could offer people who might entertain such plans.”

Flynn is one of the more intriguing figures at the centre of the Trump-Russia investigation. He came to prominence as an intelligence chief in Afghanistan, from where in 2010 he published an open critique of the way the war was fought. Instead of focusing exclusively on fighting the Taliban, Flynn and his co-authors argued, the US should be more sensitive to the general population.

However, by the time he appeared at Trump’s side as an early supporter, he had become an outspoken Islamophobe.

“Fear of Muslims is RATIONAL,” he tweeted in February 2016. According to some accounts, it was his forced retirement from the DIA under the Obama administration in 2014, apparently as a result of his abrasive management style, that left him with an enduring grudge against Democrats. On Hillary Clinton, Flynn led chants of “lock her up” at campaign events and the Republican national convention.

Flynn’s attempt to build a business empire appears to have got him into deeper controversy. He appeared on the Russian state channel, RT, and attended an RT-sponsored dinner in Moscow, sitting alongside Vladimir Putin.

In August, the Flynn Intel Group signed a deal with a Dutch firm, Inovo, owned by Ekim Alptekin, chairman of the Turkish-American Business Council and a close associate of Erdoğan. Flynn’s firm was paid more than $530,000 to dig up information about Gülen and make a film about him. On election day, 8 November, Flynn published a commentary in The Hill, describing Gülen as “a shady Islamic mullah” and “radical Islamist”.

It was his Russian ties that caused his initial downfall, however. Flynn lasted only 24 days as national security adviser, being forced to resign after it emerged he misled officials over the extent and nature of his contacts with the former Russian ambassador to Washington, Sergey Kislyak.