29/03/2006

Police could widen 'loans-for-peerages' investigation

Scotland Yard is considering whether to widen an inquiry into the 'loans-for-peerage' claims to include claims of corruption.

The Metropolitan Police are already investigating allegations that laws banning the sale of peerages and other honours had been broken.

The allegations were made following revelations that several wealthy businessmen who had made secret loans to the Labour party had been nominated for peerages. The party's treasurer Jack Dromey said that he had not known about the loans.

The government has denied that there was any link between the nominations and the loans, as have the lenders who have spoken publicly about the loans.

The Metropolitan Police's deputy assistant commissioner John Yates, who is leading the investigation into the claims, said that he has not ruled out the possibility of widening the investigation to include corruption allegations.

Mr Yates has also asked the Commons Public Administration Committee to postpone their inquiry into the claims, in order to avoid prejudicing possible police action.

The committee had been due to question two businessmen - Priory healthcare chief executive Chai Patel and property developer Sir David Garrard - regarding loans they had made to the Labour party.

Both men had been nominated for peerages, but have since had the nominations blocked by the House of Lords.

The Labour party has published a list containing the names of 12 wealthy businessmen who provided the party with loans totalling almost £14 million before the last General Election.

The Conservatives are facing pressure to reveal the names of those lent them money for last year's election campaign. So far, the party has refused to name all its lenders.

(KMcA/SP)

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