The incident occurred on August 8 and comes days after the former foreign secretary, Boris Johnson, had said that Muslim women wearing burqas and niqabs "look like letterboxes" and compared them to "bank robbers" in a Telegraph article published over the weekend.
Johnson's comments were criticized by Muslim groups and politicians including Prime Minister Theresa May, who urged Johnson to apologize. 'It was the wrong language to use.
Johnson is seen by some as a potential Conservative leader if May is forced to step down amid divisions within the party over the terms on which the United Kingdom should leave the European Union.
"The code of conduct process is strictly confidential", said a Conservative Party spokesman.More news: Polls close for MI and Kansas primaries
Speaking to the BBC's Asian Network, Dick said that "some people have clearly found it offensive" but added that specialist hate crime officers have deemed that the former two-time Mayor of London "did not commit a criminal offence".
A majority of adults in the United Kingdom do not believe Boris Johnson's comments describing women who wear burkas as looking like "letter boxes" and "bank robbers" are racist, a poll has suggested. May said she agreed with Lewis.
Warsi said Johnson was hoping to attract support from right-wing Conservatives for an eventual leadership bid, and called for an independent inquiry into Islamophobia in the party.
"This inflammatory language will in fact motivate and fuel hate crimes, particularly towards visibly Muslim women who wear the veil or the hijab", Sajda Mughal, who runs the JAN Trust charity, told the Thomson Reuters Foundation.
News of the investigation emerged as Mr Johnson was reprimanded for breaching rules for former ministers by failing to seek advice before taking up a job as a newspaper columnist after leaving the Cabinet.More news: Former Manafort partner Gates to testify next in fraud trial
"There is a rise in Islamophobic abuse - I have personally faced verbal and even physical abuse, and only two weeks ago I came across a woman who had her niqab pulled off while she was working in her shop".
Johnson is yet to issue a response.
Mr Johnson will be given the opportunity to make a statement providing "any evidence or details that will help to establish their position".
"If a woman wants to wear a short dress, it is her right and freedom to do so".
Mr Johnson's comments also underscores the Muslim Council of Britain's call for an inquiry into Islamophobia in the Conservative Party.More news: City back in the groove as Aguero ruins Sarri’s Chelsea bow