Council leader Nick Forbes has accused Newcastle United of chasing "profit at any price" after reports of a shirt sponsorship deal with payday lender Wonga.
National newspapers reported on Sunday October 7 that Wonga was about to become the club's new shirt sponsor.
But Cllr Forbes said he is appalled by the rumours and has written to Mr Ashley to “warn him of the social consequences” of the deal.
The letter, which has been seen by Sky Tyne and Wear, says: “I believe that it is the wrong image for Newcastle, NUFC, and football as a sport.”
VIDEO: Your view - Should Wonga sponsor Newcastle United?
Wonga offers short-term loans online at a rate of 4214 percent APR. That compares to rates on certain credit cards such as Barclaycard Platinum of 7.9 percent.
After hearing the news Newcastle Central MP Chi Onwurah tweeted: "Please tell me its not true that nufc are looking at a shirt & stadium deal with Wonga?"
Wonga currently sponsors Championship side Blackpool and Heart of Midlothian in the Scottish Premier League but both those deals are scheduled to finish at the end of the current season.
St James' Park was renamed the Sports Direct Arena in November 2011 in a temporary deal with club owner Mike Ashley's sportswear empire while a more permanent sponsor is sought.
Newcastle United were unavailable for comment.
- Sky Sources: Wonga Not Negotiating For St James' Park Naming Rights
- Gazza On St James' Name Change
- Video: Fans Rip Down Sports Direct Signs At Reserve Derby
- St James' Park Graffiti: Man Sentenced
- Council Calls For St James' Park To Keep Name
More from News
- EDL And Anti-Fascists March Through Newcastle City Centre
- Ambulance Needed On Fitness Guru's South Shields Booze Blow Out
- Nile Ranger Sentenced To Unpaid Work For Assaulting Girlfriend
- New Appeal For Convicted Sister Killer After Prison 'Confession'
- Lucky The Lamb Home For Easter After Police Foil Sheep Theft
- Explosive Alliance: Live Ammunition Training For British And French Troops
- Soap Box Racing: Dare You Take On The Simonside Challenge?
- Meet Newcastle's Six-Year-Old Award Winning Musical Prodigy Leia Zhu