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Brown 'had no idea' about donors Harman rejects Brown damage claim
(about 1 hour later)
Gordon Brown had "absolutely no knowledge" that proxy donors were used to give money to the Labour Party, Justice Secretary Jack Straw has said. Labour deputy leader Harriet Harman has "absolutely" denied damaging Gordon Brown's reputation after her aides accepted £5,000 from a proxy donor.
The prime minister would have "stopped it immediately" had he had "a sniff that this was going on", Mr Straw told BBC Radio 4's Today programme. Ms Harman's campaign took the cash from an associate of businessman David Abrahams after the contact had been passed to them by Mr Brown's team.
But he admitted change was needed to Labour's funding "culture". Ms Harman said she had "complied with the letter and spirit of the law and I think Gordon Brown has done the same".
Police are expected to begin looking at evidence relating to donations worth more than £650,000. It comes as police launched a probe into Mr Abrahams' donations.
In total, the North East property developer gave Labour more than
£650,000 via four associates.
'Unacceptable''Unacceptable'
The Electoral Commission asked them to investigate after it emerged that the party had received the money from Newcastle property developer David Abrahams via four associates.
Mr Brown has said the donations will be returned, as they were unlawful and "completely unacceptable".
See how David Abrahams made donations to the Labour PartyIn graphicsSee how David Abrahams made donations to the Labour PartyIn graphics
It has emerged that one of Mr Abrahams' associates - secretary Janet Kidd - attempted to give £5,000 to Mr Brown's campaign to become Labour leader. Mr Brown has said all the donations will be returned, as they were unlawful and "completely unacceptable".
But former Labour MP Chris Leslie, who was Mr Brown's campaign co-ordinator, tore the cheque up because no-one on the campaign staff knew who Mrs Kidd was. It has emerged that Ms Harman's deputy leadership campaign team accepted £5,000 from Mr Abraham's former secretary, Janet Kidd.
Mr Straw, who ran the campaign, says he was not told about the attempted donation, and neither was Mr Brown. The money was used to pay off debts run up during the contest.
Mr Straw told Today: "Gordon Brown had absolutely no knowledge of any connection - inappropriate connection - between Mr Abrahams and Mrs Kidd. Neither did I. When asked whether the acceptance of the donation had "dropped Gordon Brown in it", Ms Harman replied: "No absolutely not.
"I strongly maintain I have complied with the letter and spirit of the law and I think Gordon Brown has done the same."
Cheque destroyed
Before contacting the Harman team, Mrs Kidd had attempted to give £5,000 to Mr Brown's campaign to become Labour leader.
But former Labour MP Chris Leslie, who was Mr Brown's campaign co-ordinator, tore the cheque up because no-one on the staff knew who Mrs Kidd was.
If Gordon Brown had had even a sniff that this was going on, he would have stopped it immediately, as would have I Jack StrawJustice secretary
After the leadership and deputy leadership were settled, Mr Leslie was approached by a member of Ms Harman's team who asked if he knew of anyone who might be prepared to make a donation to her campaign fund.
"I passed them the details of Mrs Kidd as someone whose offer of a donation we had not taken up," Mr Leslie said.
He stressed that neither Mr Brown nor his campaign manager, Jack Straw, had known anything about the contacts with Mr Abrahams or Mrs Kidd's attempted donation.
Mr Straw told BBC Radio 4's Today programme: "Gordon Brown had absolutely no knowledge of any connection - inappropriate connection - between Mr Abrahams and Mrs Kidd. Neither did I.
"Neither, to the best of my knowledge - although I accept this is ultimately a matter for these inquiries - did any member of the immediate campaign team involved or the other campaigns.""Neither, to the best of my knowledge - although I accept this is ultimately a matter for these inquiries - did any member of the immediate campaign team involved or the other campaigns."
The Electoral Commission has now decided to refer matters to the Metropolitan Police for further investigation. The next step is for us to receive and review their reference report Metropolitan Police Commissioner Sir Ian Blair In full: Met Police response Chris Leslie: Full statementThe Electoral Commission has now decided to refer matters to the Metropolitan Police for further investigation. The next step is for us to receive and review their reference report Metropolitan Police Commissioner Sir Ian Blair In full: Met Police response Chris Leslie: Full statement
Mr Straw said: "If Gordon Brown had had even a sniff that this was going on, he would have stopped it immediately, as would have I."Mr Straw said: "If Gordon Brown had had even a sniff that this was going on, he would have stopped it immediately, as would have I."
He added that "for a long time this was an unknown unknown. The moment it became a known known, we got on to it."He added that "for a long time this was an unknown unknown. The moment it became a known known, we got on to it."
Mr Straw also said "99.9%" of people in the Labour Party had not been involved, adding: "I can't tell you how irritated the rest of us are about this."Mr Straw also said "99.9%" of people in the Labour Party had not been involved, adding: "I can't tell you how irritated the rest of us are about this."
He added: "I think the culture has changed but not enough. There are going to be, in every system, some errors made."He added: "I think the culture has changed but not enough. There are going to be, in every system, some errors made."
Mr Abrahams gave more than £650,000 to Labour over four years - under the names of Mrs Kidd and three other associates - Janet Dunn, John McCarthy and Ray Ruddick. One of Ms Harman's rival contenders, Hilary Benn, turned down £5,000 from Mrs Kidd, because he had been told it was actually from Mr Abrahams. He later accepted it under Mr Abrahams' name.
Harman donation
The Metropolitan Police will attempt to determine who knew about the money being channelled in this way, and who broke the law.
Under the Political Parties, Elections and Referendum Act 2000 - which Mr Straw helped draw up - details of any donor making gifts through a third party must be registered and reported to the Electoral Commission.
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As well as giving money to Labour, Mr Abrahams decided to support certain candidates campaigning to become the party's leader and deputy leader earlier this year.
Harriet Harman accepted a £5,000 donation from Mrs Kidd during the deputy leadership race she eventually won.
Ms Harman said she had no idea the money had really come from Mr Abrahams, and had accepted it on the basis that Mrs Kidd was a known Labour donor. She said she had acted in "good faith".
It has now emerged that Chris Leslie put the Harman campaign in touch with Mrs Kidd.
According to BBC2's Newsnight, Ms Harman's team needed the money to pay off debts run up during her campaign.
'Unprompted'
In a statement, Mr Leslie said that in May he had been contacted by "a man calling himself David Abrahams" who had referred him to Mrs Kidd as someone who wanted to make a donation to Mr Brown's campaign.
Mr Leslie said he did not know Mr Abrahams or Mrs Kidd. He nevertheless contacted Mrs Kidd who, "unprompted", sent the campaign a cheque for £5,000.
Contacts
When he discovered that no-one in the Brown campaign team knew who she was, Mr Leslie said he destroyed the cheque.
After the campaign was over, he was approached by a member of Ms Harman's team who asked if he knew of anyone who might be prepared to make a donation to her deputy leadership campaign fund.
"I passed them the details of Mrs Kidd as someone whose offer of a donation we had not taken up," Mr Leslie said.
He stressed that neither Mr Brown nor Mr Straw had known anything about the contacts with Mr Abrahams or Mrs Kidd's attempted donation.
One of Ms Harman's rival contenders, Hilary Benn, turned down the same amount from Mrs Kidd, because he had been told it was actually from David Abrahams. He later accepted it under Mr Abrahams' name.
Watt 'unhappy'
Mr Abrahams has said he did not know he was breaking any rules when he made the donations by proxy, claiming that he kept them secret to avoid publicity.Mr Abrahams has said he did not know he was breaking any rules when he made the donations by proxy, claiming that he kept them secret to avoid publicity.
Labour's general secretary Peter Watt has already resigned, saying he knew about Mr Abrahams' funding arrangement, but did not think they broke the rules. Labour's general secretary Peter Watt has already resigned, saying he knew about Mr Abrahams' funding arrangement, but did not think they had broken the rules.
Labour's chief fundraiser, Jon Mendelsohn, has said Mr Watt told him about the situation last month but had been unhappy about it and had contacted Mr Abrahams with the intention of putting his donations on a proper footing.Labour's chief fundraiser, Jon Mendelsohn, has said Mr Watt told him about the situation last month but had been unhappy about it and had contacted Mr Abrahams with the intention of putting his donations on a proper footing.
Earlier this year, Mr Watt was pictured with Mr Abrahams when the party official was the guest of the donor at a dinner to celebrate the 75th anniversary of the Jewish Museum in London.
The Metropolitan Police recently completed the 19-month, £1.4m "cash-for-honours" investigation into party funding.The Metropolitan Police recently completed the 19-month, £1.4m "cash-for-honours" investigation into party funding.
That inquiry, which cast a shadow over Tony Blair's final months as prime minister, ended with no charges being brought.That inquiry, which cast a shadow over Tony Blair's final months as prime minister, ended with no charges being brought.
In law, details of any donor making gifts through a third party must be registered and reported to the Electoral Commission.
The commission has asked the Metropolitan Police to investigate.