Read on for everything we know about the case and the latest update regarding a man's arrest.
According to The Sun, the 48-year-old presenter called the police after a man threatened to spread lies about her if she didn't hand over large sums of money.
The publication reported that Alison had given the man thousands of pounds as well as a £5,000 BMW after being put under pressure by the blackmailer.
The West Midlands police said in a statement: "We are investigating an allegation of blackmail of a woman in her 40s. We take reports of this kind very seriously and our inquiries are progressing swiftly."
On Saturday evening, a 36-year-old man was arrested on suspicion of blackmailing the ITV star. The following evening, police said the man had been released on conditional bail.
Last week, The Sun reported that the man in question is thought to be a former friend of Alison's. The TV personality is yet to make a statement regarding the case.
Alison's blackmail ordeal comes just weeks after she was announced as the new host of Channel 4's The Great British Bake Off.
The former Big Brother star has signed up to replace Matt Lucas, who announced his departure in December. Alison will join Noel Fielding to present the next series of the popular baking programme, which will air later this year.
In a video posted on social media, showing miniature icing models of herself, Noel and judges Paul Hollywood and Dame Prue Leith, Alison said she was "absolutely thrilled" and "so very excited".
She wrote in the caption: "It's official!! It's happening. The Great British Bake Off! Let's have it - the cake that is. So excited."
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