DCSIMG

Did she break the rules?

WENDY Alexander became embroiled in a fresh Labour Party donor row last night, as it emerged the Electoral Commission was investigating a donation to her Scottish leadership campaign fund.

Paul Green, 65, a Labour supporter in the Channel Islands, is not allowed to give money to UK political parties because he is not on the UK electoral register. The retail developer, who is behind some of Scotland's highest-profile shopping centres, gave 995 to the fund set up to run Ms Alexander's summer campaign through one of his companies, Combined Property Services, which is registered in the UK.

It is understood that Ms Alexander's team approached him to make a donation. However, as a Jersey resident, he is banned by election laws from funding politicians.

He routed the money through his Glasgow-based firm as a UK corporate donation. The pledge is just below the 1,000 limit, above which Ms Alexander would have had to register it at the outset with the Electoral Commission.

Last night, Labour officials insisted that they believed Mr Green's donation was entirely above board. However, because of newspaper suggestions that the donation might have broken funding rules, they referred it to the Electoral Commission.

The commission has asked the party for more details and will decide soon whether the legislation set out in the Elections Act 2000 was complied with.

Companies are allowed to give donations, provided they are company donations and not from one individual.

However, it is understood that Combined Property Services belongs entirely to Mr Green, so it is not clear exactly whether rules were broken.

Tom McCabe, Ms Alexander's campaign manager, said: "Paul Green was invited by one of the campaign team to make a donation as a long-standing Labour supporter.

"As required by the rules, we made inquiries about permissibility and indicated to him that only a UK resident or UK-registered company could donate. The registered donation was a UK corporate one. We acted in good faith at every stage."

Mr McCabe also denied suggestions that a donation had been accepted and then returned: "The allegation is untrue."

Ms Alexander, 44, an MSP since 1999 and the sister of Douglas Alexander, the UK International Development Secretary, was elected as Scottish Labour leader in August, succeeding Jack McConnell, the former first minister, who stood down after the party's defeat by the SNP in May's Scottish Parliament elections.

A spokesman for Ms Alexander yesterday said that the total amount generated for her leadership campaign was 17,000.

He added: "We raised this with the Electoral Commission on Monday and said we wanted to make sure we were OK. They asked us for information, and we are co-operating fully with them and will be providing them with the information."

A source close to Ms Alexander said the Scottish Labour leader would return the donation if the commission found that it broke the rules.

Last night, the SNP called on Ms Alexander to make public everything she knew about the affair.

A Nationalist spokesman said: "The row over Labour's funding sleaze has now moved across the Border, right into the heart of the Labour leadership in Scotland. It is essential that Wendy Alexander discloses all the relevant facts about this matter."

Scotland Yard told to investigate funding ... as Brown suffers 'Stalin to Mr Bean' jibe

THE donor row escalated further when the police were urged to investigate funds channelled to the Labour Party through "phantom" donors, bringing Gordon Brown's chief fundraiser into the scandal.

Opposition parties questioned why the Prime Minister had not blown the whistle himself after it was shown that Jon Mendelsohn, whom he appointed as his fundraiser in September, had known about the falsely declared donations.

Sir Ian Blair, the Metropolitan Police Commissioner, has been called in to investigate by Chris Huhne, one of the Liberal Democrats' leadership hopefuls.

The revelations came after David Abrahams, the real donor who had attempted to mask his identity by sending his donations through at least four other people, brandished a letter he had received from Mr Mendelsohn that thanked him for his support of Labour.

Yesterday, Mr Mendelsohn said he became alarmed when he saw that Janet Kidd, Raymond Ruddick and John McCarthy were listed as donors when researching donations to the party after he took up his job in September. Between them, they gave more than 600,000 on behalf of Mr Abrahams.

He said he was told at the time by Peter Watt, Labour's general-secretary who quit on Monday, that the arrangement was fully compliant with the law.

Mr Mendelsohn yesterday insisted that the letter had been sent to invite Mr Abrahams to a meeting, so he could discuss the donations face to face.

Meanwhile, David Cameron, the Tory leader, said there were "questions of integrity" for the Prime Minister to answer. Vince Cable, acting Lib Dem leader, joked that Mr Brown had gone from "Stalin to Mr Bean" in weeks. Mr Brown fought back, insisting Mr Mendelsohn had "absolutely no involvement" in Mr Abrahams' donations, which had been coming for four years. Labour would do "everything in our power" to ensure it followed "acceptable" standards in relation to its fundraising in future, said the Prime Minister.

"We are ready to take any further measures - and I hope there will be all-party support - so that everything in party politics is above board, including the use of third-party sources for donations," said Mr Brown.

He rejected a suggestion from Mr Cameron that he should have called in the police as soon as he became aware that unlawful acts might have taken place.

"The Electoral Commission will make its decision as to whether this is a matter for the police," said Mr Brown. "We will co-operate in any way possible with either the Electoral Commission or the police or both."

The row also threatened to engulf Scottish Labour as the SNP seized on figures that it claimed showed the party north of the Border must have relied on funds from Mr Abrahams to fund its election campaign.

Angus Robertson, the SNP's Westminster leader, published figures showing that Mr Abrahams donated 326,975 indirectly to Labour between the 2003 and 2007 Scottish Parliament elections. During the same period the Scottish Labour Party declared donations of only 167,131 but spent an estimated 1 million on its losing 2007 campaign.

"The issue of where Labour's laundered cash was spent is just as important as where it came from," he said.

Des Browne, the Scottish Secretary, told MPs that to the best of his knowledge, "none of those donations to the Labour Party in the last few days went to fund any of part of the Scottish election campaign".

• THE Labour Party treasurer, Jack Dromey, said yesterday that what happened in the secret donations affair was "absolutely wrong".

It was precisely the same phrase he used when launching an investigation into loans received by the party without his knowledge in the run-up to the last general election - the so-called "cash for honours" saga.

Of the latest row, involving disguised donations from millionaire property developer David Abrahams via a number of intermediaries, he said: "What happened was absolutely wrong. The Prime Minister and the Labour Party have been right to act."

Mr Dromey, who has been the party's treasurer since 2004, appeared angry, twice saying to reporters: "Complete concealment", without providing further elaboration.

His wife, Harriet Harman, may have been politically damaged after it was revealed that she accepted a 5,000 donation to her deputy leadership campaign from a secretary, Janet Kidd.

GERRI PEEV

THE KEY PLAYERS

HARRIET HARMAN

Already under-fire for accepting 5,000 from Ms Kidd to pay the bills for the deputy leadership campaign, Ms Harman is now resorting to hosting a disco to pay off the rest of the expenses. Ms Harman's husband, Jack Dromey, is Labour treasurer and questions were raised about his role when it emerged that the union he works for had also given 5,000 to the campaign.

JON MENDELSOHN

Appointed by Gordon Brown as his fundraiser in September, Mr Mendelsohn had also worked for Tony Blair, before he became prime minister. When Labour came to power, Mr Mendelsohn launched LLM, a lobbying firm, which was dragged into the cash-for-access controversy in Labour's early years in power.

PETER WATT

Mr Watt, 37, quit as Labour's General Secretary on Monday over the donations row. He oversaw the loans and is claimed to have given assurances that using proxy donors was acceptable.

He had been the party's director of finance and compliance and insiders believe he should have known the rules inside out in relation to party funding.

RAY RUDDICK

A builder from Newcastle, Mr Ruddick is recorded as having given 196,850 to Labour since 2003. Questions were raised after it was revealed Mr Ruddick was a jobbing builder, who lives in a former council house. He is listed as director of Webfast and company secretary of three other companies.

JANET KIDD

Mrs Kidd, who works for Mr Abrahams, has donated 185,000 to Labour since 2003, according to records.

Her name was attached to a donation offered to Hilary Benn, the Environment Secrtary, who refused it. But Harriet Harman, Labour's deputy leader, accepted an offer of 5,000 from Mrs Kidd, to pay off bills attached to her campaign.

JOHN McCARTHY

Newcastle-based solicitor identified by Mr Abrahams as the third person to have given money on his behalf dating back to January 2004, when he is registered with the Electoral Commission as giving 15,000 as an "individual" donor. Other payments include two for 25,000 each, one of 52,125 in 2005, and another 50,000 in early 2006.

JANET DUNN

The wife of one of David Abrahams' employees, said she had known "nothing at all" about making a 25,000 payment to Labour but her husband, Anthony, recalled a "swap cheque" transaction involving Mr Abrahams. Mrs Dunn, a Conservative voter from Ponteland, near Newcastle, said she was unhappy about the donation being made in her name.

PAUL GREEN

PAUL Green, 65, the Jersey-base multi-millionaire property developer, has a reputation as philanthropist who has taken Glasgow to his heart donating vast sums to cash-strapped community projects.

In 2005 the city's Glasgow Caledonian University honoured him as an honorary doctor after he set up a 20,000 sponsorship scheme to help pupils from Glasgow's poorest areas deprived backgrounds study for bachelor of law.

He hit the headlines again in August when his wife Jenny opened the new 350 million Silverburn shopping centre in Pollock - one of Britain's largest shopping centres. The massive project was built by his company Retail Property Holding.

In September 2003 The Scotsman reported that Mr Green "whose previous developments include the Parkhead Forge and Great Western Retail Park, pledged 1 million from his charitable trusts to social inclusion investments in Pollok if planning consent is granted."

"This is more than building a shopping centre, this is about building a community," he said.

At the time politicians and business leaders in Glasgow warned that a 200 million plan to build a shopping centre in Pollok was at risk amid claims that pressure is being put on the Scottish Executive to scupper the development.

Charles Gordon, the council leader, joined forces with Mr Green, and community leaders in calling for a positive response from ministers deliberating over the plans.

It would also be fair to say that many donations resulting from the fortune Mr Green has made from the city's regeneration have been given without publicity and fanfare.

It was by chance in 1984 that a slump in development opportunities elsewhere in Britain led him to Glasgow and the Parkhead development.

During this time he said he was impressed by the "spirit" of the people and their determination to overcome barriers to success.

Born in Northampton in September 1942 and raised in Bletchley he qualified as a chartered accountant before moving into other areas including law and stationery before making his fortune in the world of high finance and property development.

He is a big name in the world of horse racing

DAVID ABRAHAMS

The property developer and a prominent Labour figure in North-east England , Mr Abrahams gave more than 650,000 to friends and colleagues to pass on to Labour in order - ironically - to avoid publicity.

The tycoon was once deselected as a Labour candidate after it emerged that he had asked people to stand in as his wife and son.

 
 
 

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