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Friday, 22 January 2010

Lib Dems in the Brown Stuff

From Private Eye, but too good not to lift verbatim

Michael Brown
EMBARRASSMENT ahoy for the Lib Dems, just in time for the election campaign. Next month the party’s biggest benefactor, Michael Brown, will feature in Crimestoppers’ “most wanted” list, having given the party £2.4m in 2005 via a shell company, 5th Avenue Partners, of which he was the sole director

Three years later he skipped bail while awaiting trial for fraud. He has not been seen since, though he is thought to be in the Caribbean. In November 2008 he was convicted in absentia of stealing £36m from investors to whom he posed as an international bond dealer.

His appearance on the Crimestoppers website may prompt some voters to wonder what happened to his political donations. Those wholesome Liberal Democrats wouldn’t wish to get rich on the proceeds of crime, would they? Er, yes they would!

Free helicopter flights
They have refused to return the money, insisting that they accepted it “in good faith”. Was their curiosity really not aroused when someone they’d never heard of started writing them seven-figure cheques and giving the party leader free helicopter flights? Mightn’t a bit of due diligence have been in order? Apparently not. The Mallorca-based Brown was barred by law from making political donations, since he wasn’t registered as a British voter; but even this aroused no suspicions in those sweetly trusting Lib Dems.

Luckily for them, the Electoral Commission is equally unworldly. Shortly before Christmas it published its final verdict on the tainted donations. Under the rules a British company must be “carrying on business” in the UK to give money to a political party, and the commission believes that 5th Avenue Partners was doing so. It had bought “office furniture and equipment”, and set up “trading accounts”.

‘Fraudulent from its inception’
This ignores all the evidence at Brown’s trial – and a previous high court action in 2006 – showing that the only business carried on by this shell company was that of diverting dosh from his victims to himself. As Mr Justice Cooke said in 2006, giving summary judgment in a case brought by four of the firm’s investors: “There was no trading and the scheme was fraudulent from its inception, it never being Brown’s intention that the money should be used this way. Funds had instead been shunted around various accounts in Europe. It is also clear that Michael Brown tried to hide the fact that there had been no legitimate trading with the funds supplied to him.”

There was one other question the Electoral Commission had to consider. Was the true donor 5th Avenue Partners – or was it Michael Brown, in which case the Lib Dems would have to repay it? “There is no credible evidence,” the commission concludes, “that any of the donations came from Michael Brown’s own money rather than from one of his companies.” Well, they’re right in one respect. It wasn’t Brown’s own money, it was money he had stolen from investors and laundered through his company. According to the commission, this makes the gift entirely “permissible”. Case closed.

Fugitive sugar daddy
One wonders if this naivety will also dictate the outcome of another party-funding case. Last January the commission began investigating whether Bearwood Corporate Services, which is controlled by Tory moneybags Lord Ashcroft and has given more than £4.7m to the Conservative party since 2003, is actually “carrying on business in the UK”. One year on there’s still no answer. If the commission spins this out much longer, its report may not appear before the election, much to the Tories’ relief.

Meanwhile, the wretched Lib Dems must endure the shame of having their fraudulent and fugitive sugar daddy displayed on Crimestoppers. Which should give some pleasure to the founder and chairman of Crimestoppers… one Lord Ashcroft!

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