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Friday, 20 November 2009

Lib Dems cleared by Electoral Commission over Michael Brown donation

Here is the full statement from the Electoral Commission;

The Electoral Commission, the independent elections and party finance watchdog, today announced the outcome of its investigation into donations made by the company 5th Avenue Partners Ltd to the Liberal Democrats. Donations totalling over £2.4m were made in 2005.

The investigation considered whether there had been breaches of the Political Parties, Elections and Referendums Act 2000 (PPERA). In particular, it looked at whether the company, reported as the donor, was a permissible donor. It also considered whether the company was in fact the true donor. If a party accepts impermissible donations, the Electoral Commission can apply to a court to seek forfeiture of an amount equivalent to the sum accepted.

To be a permissible donor, a company must be registered under the Companies Act 1985, incorporated within the UK or another EU member state, and be carrying on business in the UK. The Commission has concluded that 5th Avenue Partners Limited met these requirements at the time the donations were made, and therefore was a permissible donor.

The Commission also considered whether there was a basis for concluding that either Michael Brown, as an individual, or 5th Avenue Partners GmbH (the parent company of 5th Avenue Partners Limited) was in fact the true donor. Neither of them would have qualified as permissible donors under PPERA.

The Commission has concluded that there is no reasonable basis to conclude that the true donor was someone other than 5th Avenue Partners Limited.

Commenting on the outcome of the investigation, Electoral Commission Chair Jenny Watson said:

“The law sets out who can make donations to political parties and makes sure that information about where parties get their money from is in the public domain, so voters can see for themselves how politics is funded. Our job is to make sure those rules are followed.

“Parliament considered carefully the rules on company donations in 2000, and set out specific requirements, including that a company must be carrying on business in the UK in order for it to be a permissible donor.

“We have conducted a thorough investigation into these particular donations to the Liberal Democrats, and considered a substantial body of evidence: evidence from the criminal proceedings against Michael Brown; documents obtained from the City of London Police, including analysis by forensic accountants; and evidence provided by the party.

“Having considered all the evidence in this case, we have concluded that 5th Avenue Partners Limited met the requirements to be a permissible donor. The Electoral Commission will be taking no further action in this case.“

The Liberal Democrats then issued this statement;

"We welcome the Electoral Commission's ruling on this matter. At all times the party acted in good faith in relation to the receipt and the expenditure of these donations in the 2005 General Election campaign. All our donations and loans were properly declared to the Electoral Commission."

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