Respect funding scam?

[faceless]

Galloway faces new cash probe over donation
05 December 2007
Exclusive by Ted Jeory
ted.jeory@archant.co.uk

A NEW crisis has engulfed MP George Galloway's troubled Respect party after it emerged this week that the Electoral Commission has been called in over a suspected unlawful foreign donation. The election watchdog is probing a $10,000 cheque from a Dubai construction company that ended up in the bank account of an organisation set up by Respect, the East London Advertiser can reveal. Even more troubling for Left Wing Respect is the donor company is owned by one of Britain's biggest private finance initiative contractors, which itself is headed by a former policy chief to John Major's Tory government.

The Electoral Commission was told about the donation by Galloway himself when he "smelt a rat." He strongly denies any wrongdoing and has asked the commission to look into the money trail surrounding the cheque. Khansaheb Civil Engineering, a Dubai-based subsidiary of Interserve plc private finance experts, sent the cheque on January 7, according to the commission.

The Advertiser understands the cheque was sent with a covering letter from a Khansaheb executive saying he was a fan of the Bethnal Green & Bow MP and wanted to contribute to his political causes. But Galloway, who was being investigated by the Parliamentary commissioner for standards for improper donations to the Mariam Appeal, feared the letter was a 'sting' by an undercover reporter.

The proposed foreign donation, he felt, would be unlawful. He told his staff to return it and suggested if the donor wanted to make a financial contribution, he should make a new cheque payable to the Stop the War Coalition. Respect's National Secretary, John Rees, has confirmed he returned the cheque on January 23. But in his letter, he suggested the funds could be resent to another Respect-backed project, OFFU, the Organising for Fighting Unions campaign, which had been set up to lobby for the Trade Union Freedom Bill. According to the campaign material, its headquarters was Respect's national office in Club Row, Bethnal Green.

A large OFFU conference in Shoreditch last year ended up with a £5,000 deficit. When Khansaheb sent a new $10,000 cheque made out to the campaign in February, it was used to cover some of the conference debts. Mr Galloway discovered this in August and says he then pushed for the Electoral Commission to be called in. This contributed to the current split in Respect, he told the Advertiser. "I wanted it referred to the commission earlier and that contributed to the split," he said.

The Electoral Commission is not yet at the 'investigation' stage, but said it was "making preliminary enquiries." Mr Rees, who admits the donation was partially used to cover the conference deficit, insists he did nothing wrong. "Galloway knew all along we had suggested an alternative destination for the cheque," he said. "He said Stop the War Coalition, we said OFFU. Galloway is now raising this to discredit his opponents. The cheque may well have been drawn on a company account, but it was clear to me it was an individual donation by someone who clearly supported our political goals."

Interserve currently manages a number of PFI-backed schools and hospitals in the UK. The boss is 55-year-old Lord Blackwell, head of Major's policy unit from 1995 to 1997, who was made a life peer when the Tories lost office. Khansaheb Civil Engineering, which helped build Dubai's luxury Jumeiran beach resort, could not be contacted for comment.

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John Rees; I might have defended him a bit in the past, but what a wanker.

[Mandy]

Foreign donations to political parties are banned.

Foreign donations to charities are allowed.

I think the issue here is how close is OFFU to a political party. This must be based on how legally OFFU is set up/structured.

I don't think it matters whether the cheque is from an individual or a corporation (assuming both are "foreign")

[faceless]

I'm sure Galloway understood the dangers, which is why he suggested a donation to the Stop the War coalition. Why Rees decided (seemingly off his own back) to ask for a donation to this OFFU group is a question that needs an answer.

[faceless]

Galloway's Respect party reels from watchdog 'donor gift' ruling
21 February 2008
By Ted Jeory

A CAMPAIGN set up to help trade union rights and which accepted a foreign donation of £5,000 was in fact part of MP George Galloway's Respect party, the Electoral Commission has suggested. If the commission's preliminary findings are later confirmed, it could mean that Respect bosses accepted an illegal donation.

The commission's investigator, John Franks, said evidence he had considered indicated that OFFU, Organising for Fighting Unions campaign, "is in fact part of Respect." But that finding is being challenged by Respect boss John Rees, who was responsible for accepting the cheque from Dubai last year. The issue is said to be central to the current split within the Respect party.

Mr Galloway, MP for Bethnal Green & Bow, called in election watchdogs late last year, weeks after claiming to have been made aware that Mr Rees had banked a $10,000 cheque from a Dubai businessman. The donor originally wanted to give the money directly to Respect, but Mr Galloway refused, fearing it would be illegal. Mr Rees wrote back to the businessman suggesting as an alternative cause, OFFU, which at the time was saddled with around £5,000 debts from a conference held in Shoreditch Town Hall in 2005. He believed OFFU was an independent organisation.

But the Electoral Commission's Mr Franks, in a letter sent to Respect officials on Monday (Feb 18), said he found it "difficult to reconcile this evidence with the claim that OFFU is an independent organisation, entirely separate from Respect"... since OFFU shared the same office as Respect, the majority of its committee members were from Respect, while Respect described OFFU as "a Respect initiative," that "most expenses" incurred by OFFU "were met by Respect" and that OFFU was "established" at the annual Respect conference. He added: "On the contrary. The evidence would seem to indicate that OFFU is in fact part of Respect, and that is my provisional view."

Even if the law considered OFFU to be a mere "members' association" only connected to rather than part of Respect, Mr Franks concluded, it would still be governed by the same restrictions on accepting foreign donations as registered parties.

However, Anti-war campaigner Mr Rees challenged the findings and told the Advertiser: "There's never been any payment from Respect to OFFU or vice versa. "OFFU was not established by Respect, but at a special conference in Shoreditch. It's simply not true that most expenses were met by Respect. The money was raised for the conference by delegates' fees and trade union donations." He added: "They say OFFU shared the same office as Respect. That's like saying everyone in the Gherkin building in The City works for the same company. Lots of organisations share addresses. There's no way people like (Labour's) John McDonald and Tony Benn, who spoke at the OFFU conference, would have spoken at a Respect event. They just wouldn't do it."

Respect officials have until March 3 to challenge the Electoral Commission's preliminary findings.

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