New twist in Labour donations row

The businessman at the heart of the Labour funding row has claimed that the party’s chief fundraiser told him anonymous donations were “a good idea”.

David Abrahams, who has donated more than £600,000 to Labour through intermediaries, says that Jon Mendelsohn was aware of the practice in April.

But Mr Mendelsohn, who became Labour fundraiser in September, says Mr Abrahams’ claims are “fictional and completely untrue”.

Labour general secretary Peter Watt has already resigned over the anonymous donations affair, while the Metropolitan police have been asked to investigate by the Electoral Commission.

Mr Abrahams has insisted that he was unaware his actions were illegal. In an interview with the Independent on Sunday he recounts his meeting with Mr Mendelsohn at a British Board of Deputies dinner in London.

“I was placed next to Jon Mendelsohn which, at the time, I felt was just a little more than coincidence,” he said.

“I then realised he was hoping to become Gordon Brown’s fundraiser and he knew I was a strong supporter.

“He did not solicit funds from me at the dinner, however. I told him that I regularly donated to the party, and I described how it was done through intermediaries for the purposes of anonymity, to which he replied, ‘That sounds like a good idea’.”

In a separate statement the property developer calls on Mr Mendelsohn to “stop damaging himself and the party’s credibility” by denying awareness of the proxy donations.

According to Mr Abrahams, about ten people were aware of the practice.

Meanwhile, in fresh allegations that Labour has pledged to investigate, the Mail on Sunday says an Iranian-born French businessman has donated more than £800,000 to the party despite not being entitled to vote in general elections.