UK Tories Received Donation from Company Linked to Conservative Baroness’s Scandal-Hit Husband

Britain’s Conservative Party received a £50,000 (around $64,500) donation in 2020 from a small accounting firm that reporters have linked to Doug Barrowman, a high-profile businessman whose wife is a Conservative member of the House of Lords.

The company that made the October 2020 contribution, Pulse Accounting Ltd., was owned at the time by one of Barrowman’s business associates, and was previously owned by an offshore trust company directed by two of Barrowman’s employees.

Both Pulse Accounting and the trust company were dissolved earlier this year, after reporters first sent inquiries on the setup to Barrowman.

Ahead of a general election set for early July, transparency campaigners in the U.K. have been sounding the alarm about the flow of untraceable money into the country’s politics. As an Isle of Man resident, Barrowman would not have been permitted to donate to British political parties unless he had registered as an overseas voter.

Barrowman and his wife Baroness Michelle Mone, the founder of a lingerie brand who was made a member of the House of Lords in 2015, have been at the center of a major scandal for the Conservatives after a National Crime Agency investigation was launched in May 2021 into contracts worth 203 million British pounds (over $250 million) that the Conservative government awarded to PPE Medpro, a company secretly owned In an interview with the BBC, Barrowman admitted to being the “ultimate beneficial owner” of PPE Medpro through a trust. at the time by Barrowman, to provide personal protective equipment (PPE) during the Covid-19 pandemic.

The deals were made after an introduction from Mone to government ministers helped fast-track the company’s bids, according to a parliamentary report. It later emerged some of the equipment that PPE Medpro provided to the government was unusable. (Britain’s Department of Health and Social Care is separately suing the company for compensation. The company has said it will vigorously defend itself against the claim.)

After numerous denials of involvement in the company, the couple last year admitted that Barrowman was its ultimate owner and that the firm had earned around 60 million pounds ($76 million) in profit from the deals. However, they denied any wrongdoing and said they had just used their business acumen and contacts to assist the British government at a time when PPE was in high demand.

The donation from Pulse Accounting was made several months after the PPE deals were signed.

As a so-called “micro-company,” Pulse was not required to file detailed public accounts, but its balance sheet for the year ending on July 30, 2021, shows that the company had six employees at the time and 57,081 pounds on its balance sheet.

Gavin Millar, a barrister and expert in elections law, called for the Electoral Commission to investigate whether the contribution was lawful.

“The donation is very large for a company like this with no substantial assets,” he told OCCRP, adding that the company had “no history of political donations.”

“There are grounds to investigate whether this was really the money of Mr Barrowman … not least of all the fact that a lucrative government contract had just been handed to his PPE Medpro company.”

In order to donate to political parties, British companies must “carry on business in the UK,” according to electoral rules.

“But even if this requirement is met it must give its own money, not the money of a hidden, impermissible donor,” Millar added.

Barrowman did not respond to questions sent to his representatives by reporters.

A spokesman for the Conservative Party did not respond directly to questions on the Pulse Accounting donation, but said the party was “funded by membership, fundraising and donations.”

“All reportable donations are properly and transparently declared to the Electoral Commission, published by them, and comply fully with the law,” the spokesman added.

Links to Barrowman

While the origins of the Pulse Accounting contribution could not be confirmed, a number of signs point back to Barrowman, including overlaps between Pulse Accounting’s owners and a company that describes itself as part of Knox group of companies, which Barrowman founded and chairs.

At the time of the donation, Pulse Accounting was listed in the U.K.’s business registry, known as Companies House, as being owned by a tax adviser named Daniel Clay through another company.

Clay and Barrowman have a history of working together: the pair were co-owners of another accounting firm, Clay Knox (UK) Limited, which was described on its website as part of the Knox group.

According to Companies House records, Clay bought Pulse in July 2019.

But financial records seen by OCCRP show that an offshore trust company called Perree (PTC) Limited actually paid 100,000 pounds ($146,000 at the time) three years before that, in 2016, to buy a controlling interest in Pulse Accounting’s parent company.

Perree is based in the British Virgin Islands, an offshore jurisdiction with corporate secrecy laws that allow its ultimate owner to remain hidden. But there is strong evidence from U.K. court documents linking it to Barrowman.

Perree was listed as the trustee of a London property among assets belonging to Barrowman and Mone that were frozen in a December 2023 court order obtained by the Crown Prosecution Service. That order also restricts Perree, along with a slew of other firms and individuals, from dealing with the identified assets unless agreed upon with the authorities.

Perree was dissolved in March 2024, but until then its directors were Voirrey Coole and Rebecca Duke, both employees of Knox House Trust Limited, one of Barrowman’s Knox group of companies. The trust was also registered in Companies House to the same address as the Knox group’s headquarters in the Isle of Man.

Perree also has a connection to PPE Medpro, the Barrowman company at the center of the pandemic scandal.

According to filings in the U.K.’s business registry, the trust entered a loan arrangement with PPE Medpro in May 2022 which would give it control over all the assets of the company if the debt was not repaid.

A former insider at Pulse Accounting confirmed to reporters that a controlling interest in the firm was initially sold to Perree, not Clay, and that it was understood at the time that Perree was part of Barrowman’s group of companies. The insider, who spoke on condition of anonymity, also showed reporters evidence that Pulse’s filings to the U.K. Companies House after the sale had not been accurate.

Although Barrowman himself has never been listed as an owner of Pulse Accounting, two employees of Barrowman’s Knox group have been listed in U.K. corporate records as Persons with Significant Control over its parent company, Pulse Umbrella Group Limited.

Clay, Coole, and Duke did not respond to requests to comment. Shortly after reporters first reached out to Clay and Barrowman about their findings on Pulse Accounting, an application was made to strike the company from the U.K. register, and in June it was officially dissolved.

A final link between Pulse Accounting and Barrowman’s businesses appears in the firm’s paperwork. Reporters found that accounts filed by Pulse Accounting in September 2020 inexplicably bear the name of a Scottish arm of his Knox Group – “Carnegie Knox (Scotland) Limited.”

Proxies as ‘Normal Practice’

Barrowman has a record of appointing proxies to head companies he ultimately controls. In a BBC interview last December about the PPE Medpro deal, he was pressed about why his name did not appear in the company’s filings, even though he admitted to being its ultimate beneficial owner.

“In terms of my appointments, they’re all handled by the people in my family office. That’s just normal practice and it’s been that way forever,” he said, without further explanation.

Barrowman has also previously used his companies to make donations to the Conservative Party. In response to reporting from The Times in 2023, he told the newspaper he had given more than 170,000 pounds ($223,000) to the Conservatives between 2017 and 2019 through another U.K. company in the Knox group, Lancaster Knox.

Those donations also included three cash payments of 50,000 pounds each. Through a spokesperson, Barrowman told the Times that “such donations were vetted and approved in an open manner by the Conservative Party in compliance with its own rules on accepting donations.”

When reached for comment, a spokesperson for Britain’s Electoral Commission — an independent agency overseeing the country’s elections — said the Lancaster Knox donations were reported as having been made by a company that carried out business in the U.K. and were not subject to extra checks or investigation.

The Electoral Commission has, however, called for outlawing contributions from companies that exceed the profits the company has made in the U.K.

“We’ve seen for some time that public confidence in the transparency of party and campaigner finance is declining,” the spokesperson told OCCRP.

“We continue to recommend to the UK Government that it introduces laws to help protect parties from those who seek to evade the law, and give voters more confidence in the process by requiring more checks on the identity of donors,” the spokesperson added.

Britain’s Conservative government has instead drawn ire for ignoring recommendations to close loopholes in the U.K.’s electoral system and bringing in new legislation that critics say potentially makes it easier to funnel money from questionable sources into British parties.

When approached about the findings, Labour Party chair Anneliese Dodds said Prime Minister Rishi Sunak had questions to answer over the donation from Pulse Accounting.

“It’s clear the Tories will take cash from absolutely anyone with very few questions asked. Labour will clean up politics and turn the page on 14 years of Tory sleaze.”