UK Politics

Straw wants watchdog to investigate Conservative donation row

Media playback is unsupported on your device
Media captionJack Straw: The law is clear on donations

Jack Straw has urged the Electoral Commission to investigate whether laws on political donations have been broken after the "cash for access" row.

The Labour MP said there was a case for the watchdog to examine whether the former Tory treasurer Peter Cruddas, who resigned over the row, and adviser Sarah Southern had breached the rules.

Only UK-registered firms and people on the electoral roll can lawfully donate.

The Conservatives say they have "strict regulations" for accepting money.

Mr Cruddas was secretly filmed by reporters from the Sunday Times saying that a donation of £200,000 or £250,000 gave "premier league" access to party leaders, including private dinners with Prime Minister David Cameron and Chancellor George Osborne.

Due diligence

The reporters were posing as representatives of a fake financial firm based in Liechtenstein. Under UK law, such a company would not have been able to make a donation to any British political party.

The Sunday Times said Mr Cruddas had suggested the firm opened a British subsidiary or used UK employees as a conduit in order to comply with UK funding rules.

Consultant Ms Southern, the former Conservative Party staffer who introduced the undercover reporters to Mr Cruddas, was recorded by the newspaper as saying: "As long as the money is coming from a legal UK-registered donor, or a legal registered UK company that is operating, then they will normally be happy.

"They [the Conservatives] will do some due diligence but they don't pry as to where that money comes from at all really. It is impossible to. How can you know where someone's money has come from if it is kind of within a sensible parameter?"

Vetting donations

In his letter to the Electoral Commission, Mr Straw said the Sunday Times reporters "were allegedly told that money from foreign investors could be channelled through a company established by the reporters as they were on the UK electoral roll".

"These reports raise serious questions as to how the Conservative Party is soliciting donations, potentially in contravention of the Political Parties, Elections and Referendums Act 2000."

The former justice secretary had earlier told the BBC that the laws covering donations were "very clear".

"New laws I introduced in 2009 make sure you cannot use front organisations to disguise the original source of the donation," he told Radio 4's Today programme.

"On the basis of what Ms Southern says, I think there is a prima facie case for the Electoral Commission to investigate whether there has been a breach of the rules, potentially a breach of the criminal law, by Ms Southern and Mr Cruddas."

The watchdog was also entitled to look at whether the Conservatives had "safe procedures" for vetting donations, he added.

"I have to say that Sarah Southern suggests or implies, in her conversation with the undercover Sunday Times reporters, that they operated the regulations with a light tough, a veneer of compliance, but other things were going under the surface."

The Electoral Commission has yet to say whether it will consider the complaint.

In a statement, it said: "The law states that companies can donate to political parties if they are: registered at Companies House; incorporated in a member state of the EU; and are carrying on business in the UK.

"Before accepting a donation, political parties must check that they know who the donor is and that they are allowed to donate."

'Clear process'

The Conservative Party has insisted no money was accepted as a result of the meeting, and that it vets donations thoroughly.

Mr Cameron has said Mr Cruddas's remarks were "wrong and unacceptable" and has asked Lord Gold, a Conservative peer and lawyer, to review party procedures following the row.

Downing Street has rejected suggestions the Conservatives do not make sufficient checks to ensure donations are legitimate.

A No 10 spokesman said on Tuesday all donations "have to comply with strict regulations" and the party have a "very clear process" to ensure any money is within the rules, including a special team to make sure foreign donations did not get through the system.

More on this story