The FinCen Files: How Moscow is Funding the Conservative Party

Political Donations in British Politics

Within the last decade, donations to political parties in the UK have reached over £541 million (Kraemer, 2020). Of that total, the Conservatives have received £267 million, a considerable advantage over all other parties, with Labour – the second largest recipient of donations – receiving £152 million.

Throughout the 2019 campaign alone, the Conservative party received a total of £19,370,908 in registered donations (Audickas, 2020). Notably, the majority of these donations came from individual donors (£13,265,157), with a considerable portion of funds also coming from companies (£5,997,751). For reference, under British electoral law, parties must register donations if they are over £7,500 and exclude donations from the total if they are under this amount (Electoral Commission, 2020). Such a rule demonstrates how the Conservatives have received considerable sums of money from a variety of well-financed individuals, as the registered £19 million received stems from financial backers who have donated upwards of £7,500 per donation.

In contrast, Labour received a fraction of such contributions, reaching a total of £5,411,296 in registered donations throughout the whole of the 2019 campaign – less than what the Conservatives received from corporate interests alone. Nearly all of Labour’s registered donations came from trade unions (£5,039,754), whilst individuals and companies invested a combined total of £361,042. Two-thirds of Labour’s funds were individual donations under £20, meaning such funding is not registered in the overall total as these donations do not cross the £7,500 threshold.

As shown in this chart, the Conservative party received 63% of all registered political donations in the 2019 General Election campaign, drastically more than all other parties combined.

It is important to note that, in the UK, political donation sums are not capped at a maximum spend limit, meaning any individual or company can donate as much as they like. However, donations can only be made by individuals registered to vote in the UK, corporations registered in the country, or UK-based trade unions (Electoral Commission, 2020).

The Kremlin’s ‘Dirty Money’

Amongst the numerous wealthy individuals that regularly donate to the Conservative party, one Russian-born individual, Lubov Chernukhin, has grown in notoriety within the past few years. Lubov Chernukhin is married to Vladimir Chernukhin, a well-connected banker who has previously served as Deputy Minister of Finance in Russian Parliament under President Putin. In 2010, the couple officially emigrated to the UK and were granted British citizenship, meaning they are legally allowed to donate to political parties within the United Kingdom. Since then, Lubov Chernukhin has donated more than £1.7 million to the Conservative party, making her the largest female donor in British political history in just under a decade (O’Neill, 2020).

However, in a recent leak of over 2,500 documents – known as the ‘FinCen Files’– it was revealed that international banks have been assisting in the funnelling of ‘dirty money’ from around the world to offshore tax havens (Leopold et al., 2020). Amongst those individuals listed in the exploitation of such corruption, was Russian politician and billionaire, Suleyman Kerimov.

Within the leaked documents, it was revealed that, in 2016, Lubov Chernukhin received £6.1 million from Suleyman Kerimov through shell companies in the British Virgin Islands. Since this injection of cash, the majority of Chernukhin’s £1.7 million in political donations to the Conservative party have been made. For example, in 2019, Lubov Chernukhin had dinner with Theresa May and her cabinet following a £135,000 donation (BBC Panorama, 2020). Moreover, in February of this year, Chernukhin had a tennis match with PM Boris Johnson, courtesy of a £45,000 donation to the Conservative party.

Such an insurgence of illicit funds correlates with a recent report released by the British Intelligence Security Committee on Russian interference, which warns how there is an increasingly integrated network of “individuals and organisations who manage and lobby for the Russian elite in the UK” (ISCP, 2020). Referring to London as ‘Londongrad’, the report asserts that these funds allow for Moscow to build “influence across a wide sphere of the British establishment”. As a consequence, Russia’s financial presence in Westminster is now running so deep that any preventative measures taken by the British government “are not preventative, but rather constitute damage limitation”.

Although it is near-impossible to determine the specific details of conversations between these individuals, it is clear that through the secretive injection of funds, Kremlin-linked assets have been able to establish close relationships with those in the upper-echelons of Britain’s political elite. Simply put, Russian influence via monetary means is not an emerging threat; it is instead one that is already deeply embedded within the British establishment.

Conclusion

Ultimately, the leak of the FinCen files demonstrates how Moscow has successfully utilised Kremlin-linked individuals with British citizenship to indirectly fund and establish relationships with key figures in the Conservative party. By funnelling money – and thus influence – from East to West, Moscow’s actions are emblematic of a sharp and aggressively motivated state which is looking to influence decision-makers in the UK from a far, manipulating the policy of the state from within.

However, at the core of the issue lies a British government which has both accepted these donations and further “shied away” from preventing these individuals from piercing its political networks (Aleem, 2018). By continuing to accept these large donations from shadowy individuals, the wealth and influence of the party is being placed above the sovereignty of British politics. Democracy, in essence, is up for sale to those willing to pay the fee (Geoghegan, 2020).

 Bibliography

Aleem, Z (2018). “The UK could seriously punish Russia for the spy attack. Here’s why it probably won’t.” Vox. Available from: https://www.vox.com/world/2018/3/16/17123918/russia-nerve-agent-attack-uk-sanctions-spy-skripal

Audickas, L (2020). “General Election 2019: Which party received the most donations?” House of Commons Library. Available from: https://commonslibrary.parliament.uk/general-election-2019-which-party-received-the-most-donations/

BBC Panorama (2020). “FinCen Files: Tory donor Lubov Chernukhin linked to $8m Putin ally funding.” Available from: https://www.bbc.co.uk/news/uk-54228079

Electoral Commission (2020). “Donations and Loans.” Available from: https://www.electoralcommission.org.uk/who-we-are-and-what-we-do/financial-reporting/donations-and-loans

Geoghegan, P (2020). Democracy for Sale: Dark Money and Dirty Politics. Apollo: Head of Zeus.

ISCP, Intelligence and Security Committee of Parliament Report on Russia (2020). Available from: https://docs.google.com/a/independent.gov.uk/viewer?a=v&pid=sites&srcid=aW5kZXBlbmRlbnQuZ292LnVrfGlzY3xneDo1Y2RhMGEyN2Y3NjM0OWFl

 Kraemer, D (2020). “Tories way ahead in donations over past decade.” BBC. Available from: https://www.bbc.co.uk/news/uk-politics-51665162

Leopold, J., Cormier, A., Templon, J., Warren, T., Singer-Vine, J., Pham, S., Holmes, R., Ghorayshi, A., Sallah, M., Kozyreva, T., Loop, E., (2020). “The FinCen Files”. Buzzfeed News. Available from: https://www.buzzfeednews.com/article/jasonleopold/fincen-files-financial-scandal-criminal-networks

O’Neill, S. (2020) “Lubov Chernukhin: Quiet Russian’s £1.7m makes her top female Tory donor”. The Times. Available from: https://www.thetimes.co.uk/article/lubov-chernukhin-quiet-russians-1-7m-makes-her-top-female-tory-donor-z2c00bcxl.