Electoral Commission Report Into Michael Ashcroft: The Facts (2)

Electoral Commission Report Into Michael Ashcroft: The Facts (2)

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The reports:

‘During the year ending March 2006, BCS [Bearwood Corporate Services] received £4.79m in cash for shares that were bought by its holding company, Bearwood Holdings.

‘Bearwood Holdings had received that money by selling shares in itself to another company, Astraporta UK, for £5.54m.

‘Astraporta, in turn, appears to have received its funds, around £6m, by selling shares to a company registered in Belize called Stargate Holdings.

‘Where Stargate receives its funds is unclear.  It is registered offshore – at a registry controlled by an Ashcroft company.

‘When the Guardian visited the registry’s offices in Belize City to inquire about Stargate, a registry official said: “You will never know who owns Stargate.”

‘Astraporta and Bearwood Holdings were put into liquidation last year and were formally dissolved on Monday.’

2. BCS did not donate to the Conservative Party on behalf of someone else.

Stargate Holdings

In order to establish a subsidiary acted as an agent for a parent company, the Electoral Commission said there must be evidence of some or all of the following:

  • a benefit to, or impact on, the parent company;
  • an express or implied agreement that the subsidiary would act as agent for the parent company;
  • a consequential intention to conceal the true source of the donation or to evade the relevant UK law.

The Commission said establishing that Stargate transferred funds to BCS was not in itself sufficient to establish an agency arrangement, as ‘the capitalisation of a subsidiary by a parent company is a common business practice,’ regardless of whether the parent is based overseas.  This being so, it found no evidence to indicate an agency agreement between BCS and Stargate.

Michael Ashcroft

In relation to Mr. Ashcroft, the Electoral Commission said it considered a number of facts, including:

  • references to donations made by Mr. Ashcroft in his book ‘Dirty Politics Dirty Times';
  • the fact that Mr. Ashcroft authorised the making of donations by BCS;
  • the fact that Mr. Ashcroft is Deputy Chairman of the Conservative Party and involved in the process by which donations were requested by, and funds allocated to, local candidates and party associations;
  • the fact that donations from BCS were often referred to in internal party communications as ‘Ashcroft’ donations, either directly or ‘via’ BCS, with Mr. Ashcroft regularly being referred to as the donor.

Despite the above, the Commission could find ‘no direct, or cogent circumstantial evidence … of any channelling of funds for donation by Michael Ashcroft, either directly to BCS or via anyone else.’  ‘Nor was there evidence of an agreement between Michael Ashcroft and BCS that BCS would make donations on his behalf.’

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