Shaun Rolph has been looking at the Political Parties, Elections & Referendums Act of 2000 and has identified the sections which could spell real trouble for both Lord Levy and the Prime Minister. And it can all be traced back to Jack Dromey's outburst in March about not being told about loans taken out by the Labour Party. Shaun Rolph says...
The Prime Minister could face a year in prison and a £5,000 fine under legislation brought in by his own government to clean up party funding. He could be forced to step down as both Prime Minister and as an MP if found guilty of ‘illegal practices’ under the Political Parties, Elections and Referendum Act. He would be barred from standing for any elective office, and even from voting in elections, for three years.
What Crime Has Been Committed?
Jack Dromey is the Treasurer of the Labour Party. On 15 March 2006 he stated that he was unaware of loans totalling £3.5 million from Dr.Chai Patel, Barry Townsley and Sir David Garrard, all of whom had been nominated for peerages.
He said that this was in contrast to his being regularly consulted about bank loans. He told the BBC, “It cannot be right that the elected officers were kept in the dark”. If Dromey’s statement is correct, then one or more offences has been committed under the Political Parties, Elections and Referendums Act 2000. This is the legislation that established the Electoral Commission and the need to report to them all donations greater than £5,000.
So, anyone who, with intent to deceive, concealed from Jack Dromey (i) the amount of any donation made to the party, or (ii) the person or body making such a donation, has committed a criminal offence.
Were The Loans Donations ?
The prosecution would have to prove that the loans were, in fact, donations. The legislation makes it clear that a donation is any money lent to the party otherwise than on commercial terms. Note that it specifies terms,not solely rates, so redemption dates and the likelihood of conversion to gifts, given past practice, will be considered when deciding if the loans were commercial.
Who Hid The Loans From Jack Dromey ?
Sunday Herald, March 19 2006 ‘Levy, with Blair’s backing, contacted Labour’s then general secretary Matt Carter to resurrect the process of securing commercial loans from wealthy Labour backers.’
The Times, July 16 2006 'The £14 million in secret loans was known only to Mr Blair, Lord Levy and Matt Carter, the general secretary of the Labour Party at the time’
Scotland on Sunday, 16 July 2006 ‘It was a full year before the 2005 general election that Blair, his chief-of-staff Jonathan Powell, Levy and Carter met in the Prime Minister’s ample Downing Street study to discuss how to return a Labour government with dwindling revenue. The four men swiftly decided to ditch the principled avoidance of the loans loophole.’
What Punishment Could They Face?
What Next ?
Deputy Assistant Commissioner John Yates is leading a team from the Specialist Crimes Directorate looking into the possible sale of honours and the concealing of donations. He has told MPs that two files have already been passed to the Crown Prosecution Service. A decision whether to prosecute is expected in October or November of this year.What began with Jack Dromey’s statement in March may end with him in the witness box giving evidence against Tony Blair and other senior Labour figures.
So the Prime Minister and Lord Levy could ironically be caught by the very legislation their own government introduced. What poetic justice.
Note: Shaun Rolph is the author of this analysis, which he posted on his blog on Friday. He emailed me yesterday to ask what I thought of it. I thought it provided a new perspective and some new information so we agreed I would post it on here to give it a wider audience. Do visit Shaun's Blog and give him your feedback too.