Brown will 'assist' donors probe

The prime minister has vowed to give his backing to the "fullest possible investigation" into Labour funding.

In a letter to the Met Police, Gordon Brown said he was "ready to assist" the police probe and had asked Labour MPs, staff and peers to "co-operate fully".

They are investigating gifts to Labour of more than ?650,000 which businessman David Abrahams made using proxy donors.

Number 10 has played down reports of a rift between the PM and Labour's deputy leader Harriet Harman over the affair.

Mr Brown has insisted that he knew nothing about the funding arrangement with Mr Abrahams.

The prime minister has said all the money paid out by Mr Abrahams will be returned.

In his letter to Met temporary commander Nigel Mawer, Mr Brown said that the manner in which the donations had been made was "unacceptable" and that he would urge Labour Party staff and representatives to be "pro-active" in assisting the police.

He had asked Labour staff, MPs and peers to "co-operate fully in providing relevant information", he added.

Mr Abrahams has said he did not know he was breaking any rules when he made the donations by proxy, claiming that he kept them secret to avoid publicity.

In a statement, Mr Abrahams said he always had discussed the manner of my donations with party officials and "it was never suggested to me that I was doing anything wrong".

"I'm not going to discuss particular meetings with particular individuals save to confirm (Labour's chief fundraiser) Jon Mendelsohn discussed this particular method of donating money with me in April," he said

"I received thank you letters from the Labour Party following donations I had made."

But Mr Mendelsohn denied that he met Abrahams to discuss making donations to the party via intermediaries.

His lawyer said this was "absolutely untrue", adding that the two men did meet at a Jewish event and discussed what he called a "specific charity project to enable Muslims to visit Israel".

Labour's general secretary Peter Watt has already resigned, saying he knew about Mr Abrahams's funding arrangement, but did not think they had broken the rules.

Mr Mendelsohn has said Mr Watt told him about the situation last month but had been unhappy about it and had contacted Mr Abrahams with the intention of putting his donations on a proper footing.

Earlier, Downing Street played down a reported rift between Gordon Brown and Harriet Harman over the affair, following revelations about the way Ms Harman's successful campaign for Labour's deputy leadership was funded.

Her team accepted ?5,000 from a donor linked to businessman David Abrahams.

Ms Harman earlier appeared to implicate Mr Brown in the affair by revealing his former leadership campaign manager, Chris Leslie, had suggested one of Mr Abrahams's intermediaries, Janet Kidd, as a possible donor.

Asked earlier if she had "dropped Gordon Brown in it," she replied: "No, absolutely not."

In a separate development, the Electoral Commission has asked Ms Harman to explain how she paid for her campaign after BBC Newsnight revealed substantial loans were taken out.

Any such loan should be reported to the Electoral Commission within 30 days. Only one loan, an overdraft facility for ?10,000 taken out in October last year has so far been reported.

A statement made on behalf Ms Harman said that she subsequently took out a ?40,000 extension to her and her husband's mortgage with the Halifax to fund the campaign.

"The Harriet Harman campaign was under the impression that she did not need to register her mortgage with either the Electoral Commission or the Register of Members' Interests," the statement said.

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