The thrice-married star was partying with Kevin Lane, who has spent 18 years in prison "for shooting dead a car dealer in 1994", and the pair left a central London venue "arm in arm and kissing", reported OK! magazine.
"There was an instant connection between Kevin and Kerry. She was very wrapped up in him and they left arm in arm and kissing. (But), it's the last thing she needs now. If she'd had an inkling she wouldn't have gone near him.
"She's had her fill of men with dodgy pasts. She really is trying to clean up her image and she is mortified that this has happened," an onlooker said.
"Kerry had never met him before that evening. He was invited by a friend of a friend to join their group for part of the evening. She certainly had no idea of his history. There was no romance at all. She posed for a photo with him and pretended to kiss him that's it," the rep said.
Katona was previously married to Westlife singer Brian McFadden, taxi driver Mark Croft, who has admitted to running a cannabis farm and rugby star George Kay, who is currently awaiting trial for allegedly attacking her with a Taser.
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