UKIP faces electoral expenses probe

Nigel Farage - credit EP

The Electoral Commission has launched a probe into UKIP amid allegations the party misspent EU funds.

The body, which regulates financial and election conduct of political parties, will investigate whether UKIP accepted "impermissible donations" from a European Parliament group it leads.

European Parliament officials have already decided UKIP breached the rules by using EU grant funding for campaigning in last year's general election and the EU referendum.

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It is thought some of the funds may have been spent in Thanet, where Nigel Farage was standing in the General Election, one of a number of constituencies where there is also already an ongoing investigation into electoral spending by the Conservative party.

UKIP is accused of accepting forbidden donations from Eurosceptic group the Alliance for Direct Democracy in Europe (ADDE) and its affiliated foundation the Initiative for Direct Democracy in Europe (IDDE) for use at national level.

A leaked audit compiled by the European Parliament Bureau (EPB) earlier in the week claimed the ADDE group misspent around £400,000 of taxpayers' money on its own electioneering and Brexit campaign.

The EPB has ordered the ADDE to repay some €172,655 and ruled it will be denied €248,345 in grants it could have pocketed if it had followed the rules.

The ADDE, an alliance of parties from across the EU and founded by UKIP leader Nigel Farage, is entitled to spend a large portion of its EU grant on certain costs connected to European elections.

But it cannot be used for the direct or indirect funding of national parties, election candidates and political foundations at either the national or European level.

The Electoral Commission said today: "The Commission has now opened its own investigation into UKIP to look at whether there has been any breach of UK election law.

"This includes whether any impermissible donations have been accepted by the party."

It added: "Once the investigation is complete, the Commission will decide whether any breaches have occurred and if so what further action may be appropriate."

In a statement the European Parliament Bureau said: “The activities of the ADDE which were found to breach the rules for European party financing were nine opinion polls held in the UK ahead of the 2015 general elections as well as ahead of the EU referendum in 2016, and a report on these polls.

“The expenditure linked to the services of three consultants was considered non-eligible by an external auditor and by the Parliament's administration.”

Parties are required by law to declare all impermissible loans and donations, and permissible financing of over £7,500.

If found to have breached the rules, UKIP could face a fine of £20,000.