Amid the City-boy Leave funders and money-moving, tax-dodging millionaires who are dominating the funding of the Tory leadership debate, there are a number of links to overseas influences. This shouldn’t be surprising given two of the remaining candidates are or have held the role of foreign secretary, while others have worked in some capacity at the foreign office, but it is important to understand who is funding these democratic campaigns and, in the words of parliament.co.uk, “which others might reasonably consider to influence his or her actions or words as a Member of Parliament”.
Russia-born billionaire Lev Mikheev donated £10,000 to Stewart’s campaign. Mikheev splits his time between London, the US and Moscow, where he has offices next to the Kremlin and is said to have made his money managing the funds of wealthy Putin allies.
Last year Cambridge Evening News ran a story about how Mikheev’s charity had bought 14 new flats in a city with a housing crisis and left them unoccupied. Last year The Mikheev Charitable trust raised £2.9m (mostly through donations from Mikheev himself) and owned over £7m in investments and other assets. It spent about £300,000 on charitable causes, about half of which went to Cambridge University.
Stewart has also accepted £10,000 from Khaled Said, co-founder of investment company Capital Generations Partners. According to his bio on the company’s site, Said has also managed his father’s money, Wafic Said. The elder Said, who currently resides in tax-haven Monaco came to prominence as a political fixer in the Eighties by helping arrange the Al-Yamamah arms deals between Britain and Saudia Arabia.
The deal was investigated by the Serious Fraud Office in the mid-2000s, but after pressure from the Saudi and British governments, the investigation was dropped. Wafic Said was investigated in 2009 by the Electoral Commission on suspicion of using UK-born relatives to donate to the Conservative party after foreign donations were made illegal.
Stewart worked in Iraq after the coalition invasion of 2003, at first supporting the war but changing his mind after the coalition’s failures became clearer, so it will be interesting to see what approach he will take to the Middle East if he is elected.
While Saudi Arabia is unlikely to be a deciding factor for most Conservative members when they post their ballots to decide their new leader, it may still play an important factor in the policies of any new prime minister.
One of those is the second favourite Jeremy Hunt, who has seemingly benefited from his time as foreign secretary. Ken Costa, who has donated through his business K J Costa Advisory Ltd and is regularly cited as one of the Tory party’s most powerful backers, has given £10,000 to Hunt’s campaign. Costa has previously worked on the Songbird board, appointed by Qatar in its attempt to take control of Canary Wharf, and was key in brokering the deal to sell Harrods to the Qataris for £1.5bn.
That success saw Costa appointed as the government’s special representative for Saudi Arabia’s “Vision 2030″ programme. This programme aims to “[reduce] the nation’s dependence on oil, diversifying its economy and developing public service sectors such as healthcare, education infrastructure, recreation and tourism”.
Costa’s main priority so far, it seems, has been to persuade Saudi Aramco, the world’s largest company, to list on the London Stock Exchange. This has included the UK regulator loosening rules on sovereign-controlled companies in an effort to complete the deal, which may come to fruition in 2020, although there have been problems since it was first mooted in 2017.
While Costa’s work with Saudi Arabia predates Hunt’s position as foreign secretary, the donation could be seen as an endorsement of Hunt’s stance on the region. It wouldn’t be too surprising, as Hunt has avoided significant criticism of the country’s regime since taking office — despite allegations of human rights breaches in Yemen and their involvement in the brutal murder of journalist Jamal Khashoggi.
As other EU countries, including Germany, imposed an embargo on selling arms to the country, Hunt instead wrote to the German government asking them to reconsider the arrangement. The foreign secretary claimed it would have a significant effect on manufacturers of arms in Britain and across Europe. When he was asked about the letter, the Independent reported he said that selling arms would ensure “a European voice at the table doing everything we can to press for peace”.
Johnson may not want to talk to his rival candidates or the British public but he has been very busy this year on top of being the foreign secretary, writing his column and trying to oust Theresa May, with high-paying speaking engagements.
Donations by individuals or companies registered outside the UK are illegal and can result in a forfeit of criminal funds. Johnson is not likely to break campaign finance regulations in such a way… again. But of all the candidates, Johnson has most frequently been paid for his oratory skills — as much as £94,000 for one speaking engagement.
That instance was with the New York-based asset management company Golden Tree Asset Management, which specialises in sovereign wealth funds, the assets and money owned by the State.
Bizarrely, The Pictet Group, a Swiss-based private bank paid Johnson just under £30,000 for a speaking engagement in mid-April but in May started selling its sterling positions thanks to the chaos caused by Brexit and the Leave campaign. Fund manager Andrew Cole told Bloomberg: “May’s departure is priced in, but I’m not sure the market is ready for Johnson.”
Paying Johnson while fully expecting him to ruin your finances is a running theme. The British Insurance Brokers Association (BIBA) asked its members if they were worried about Brexit impacting their livelihood. The majority said they did, and BIBA has begun work with European partners to create some stability. This raises the question of why it paid Johnson more than £25,000 for two hours of speaking?
These figures might seem astronomical for what is likely a couple of hours worth of textbook Johnson bluster, but £12,500 per hour for a little influence and a little goodwill with a potential leader of one of the world’s major economies, on the other hand, doesn’t sound like a bad deal at all.
Also a part of our Tory leadership coverage