D.C. Council member Mary M. Cheh (D-Ward 3) is preparing legislation to severely curtail the amount of money that people can give to political campaigns through a money order, fallout from the expanding federal probe into city fundraising practices.

Cheh said Wednesday afternoon that her staff is drafting a bill that bans the use of money orders for any donation over $25. Cheh initially considered introducing a bill to ban donating via money order altogether, but decided that some residents “without bank accounts” may still want to donate to political campaigns.

“These things are an invitation for mischief,” Cheh said.

Currently, there are no limits on how much a donor can give via a money order as long as they do not exceed the legal donation limits for mayor and council candidates. But the city already places a $25 cap on cash contributions to candidates, which Cheh is using as a model for her bill.

In recent months, there has been growing scrutiny of how donors and political candidates use money orders to raise and spend money in District campaigns.

In July, The Washington Post reported that Mayor Vincent C. Gray’s 2010 campaign improperly exchanged cash for money orders to get around the $25 limit on cash contributions.

This week, Council member Vincent B. Orange (D) has been forced to explain the origins of $26,000 in money orders and cashier’s checks to his campaign last year.

Several of the money orders, which came in $500 or $1,000 increments, had sequential order numbers. The money orders appear to come from different donors, but the handwriting on several of them appears similar. According to tracking numbers, some of the money orders were purchased in the District but sent in the names of donors with addresses in California or Georgia.

Orange said Jeffrey E. Thompson, who has a $322 million health-care contract with the city, collected the donations.

Earlier this month, federal authorities raided Thompson’s home and office as part of an ongoing probe into campaign finance activities. Thompson, who has not been accused of wrongdoing, has declined comment.

On Wednesday morning, the D.C. Office of Campaign Finance announced that it is conducting an audit of Orange’s 2011 campaign.

By pushing to cap money orders to donations of $25 or less, Cheh believes the District would create additional safeguards against fraud.

“Lets just make them equivalent to a cash contribution,” Cheh said. “It would preserve the option for people who don’t have bank accounts. But I assume in those cases, you are not going to be giving $500.”

Cheh plans to introduce her bill at Tuesday’s council meeting. But she is trying to determine whether to push for it as emergency legislation, which would allow it to go into effect in the months leading up to the November general election.