A victim of sexual abuse has told Sky News that the former MP Sir Cyril Smith assaulted him on the premises of a council-run residential special school.
In his first television interview, Chris Marshall says he was a nine-year-old boy at Knowl View school in Rochdale when he was taken to a room and abused by Smith.
The claims come a day after police acknowledged for the first time that Smith, who died in 2010, sexually and physically abused young boys in the 1960s.
Liberal Democrat leader Nick Clegg said: "I am deeply shocked and horrified by these terrible allegations and my thoughts are with the victims who had the courage to speak out.
"These allegations should gave been more thoroughly and more properly investigated at the time. It's very bad that they were not.
"And of course any new allegations must now be looked at very closely by the police because the victim deserve nothing less."
Mr Marshall, who is now 40, has waived his anonymity in the hope that other victims will speak out.
He said: "It was late at night. A member of staff came in and took me from my bed, took me downstairs to a flat that was in the bottom of Ashworth (dormitory) and I was taken in the room.
"There was another pupil and there were two men in there ... one that we called 'The Fat Man' and we were asked to do oral sex.
"He did it to us, we did it to them. I was there - it seemed like a long time and then I was sent back up to my dormitory."
Through tears, Mr Marshall said: "I was probably about nine. I blanked it out for so long. I don't know what I was thinking. I just knew it wasn't right and I didn't want to be there. I just wanted to go home."
Smith was a governor at the school and allegedly had his own set of keys.
Mr Marshall said that throughout his life he has suffered depression and trauma as a result of his ordeal.
He told Sky News he believed there were many people still in positions of authority who were aware of the abuse but did nothing to stop it.
Mr Marshall's former housemaster at Knowl View school, Martin Digan, has said he alerted the authorities on many occasions but was "given the brush off".
He is urging the authorities to take action against those in authority who "swept the abuse under the carpet".
Jim Taylor, Chief Executive, Rochdale Borough Council said: "If anyone has any information relating to this enquiry I advise them to contact Greater Manchester Police who are investigating the abuse allegations about Cyril Smith.
"We are co-operating fully with their investigation and any relevant council records will be given straight to the police."
Smith, who was elected MP for Rochdale in 1972, was dogged by rumours of abuse throughout his career but charges were never brought.
But both Greater Manchester Police and the Crown Prosecution Service have now said if Smith had been accused today he would be charged and prosecuted.
Smith served as the Liberal and later Liberal Democrat MP for Rochdale between 1972 and 1992.