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Clegg: No wrongdoing by Lib Dem MPs

Deputy Prime Minister Nick Clegg has denied any wrongdoing by Liberal Democrat MPs after a party fundraiser faced allegations that he sought to bypass donation laws.

The party's election campaign leader Lord Ashdown acknowledged that Ibrahim Taguri had "serious questions to answer" after the Daily Telegraph reported that he told an undercover reporter posing as a wealthy Indian businessman that he could channel donations via family members and backdate cheques to avoid appearing on public registers.

The party's former chief fundraiser - who has quit as the Lib Dems' general election candidate in Brent Central following the allegations - was also said to have promised big donations could "open doors" and introduced the fake donor to key figures including Treasury Chief Secretary Danny Alexander.

Mr Alexander was recorded at a dinner thanking the supposed businessman for what he was doing, adding: "I won't intrude on the details, but genuinely it will make a difference."

Mr Clegg told LBC radio that the recording showed "Danny being a polite guy, just saying thank you to someone who he has been told is supporting the party".

The Lib Dem leader added: "The idea that Danny or any parliamentarian has done anything wrong is categorically untrue.

"On the issue of Ibrahim Taguri, no cheque has been received by the Liberal Democrats, no cheque has been cashed. If we had received this cheque in question, of course it would have been scrutinised and checked."

Mr Clegg said that, alone among political parties, the Lib Dems had invited the Electoral Commission to examine the processes they have in place to scrutinise donations and been told they were "sound and satisfactory".

He called on the other major parties to come together within six months of the general election to agree new rules for party funding, accusing David Cameron and Ed Miliband of "skewering" his attempts to deal with the problem during this Parliament.

Asked whether individuals could buy access to senior Lib Dems with large donations, Mr Clegg said: "That's ridiculous. It doesn't work like that at all."

Mr Taguri, who has also stepped down as the Lib Dem race equality champion, denied any wrongdoing and said he was "confident that I will be exonerated of all the claims made against me".

He intends to fight the election as an independent but said he hoped to return to the party fold after clearing his name.

Lord Ashdown said it was a "serious allegation and we are treating it very seriously", but the party had done "nothing illegal or improper".

"We have not received any cheques, we have not banked any cheques," he told BBC Radio 4's Today programme.

"It is commonplace and it is common practice among all the parties for donors to meet with senoir officials. That is what happened on this occasion, that is all that happened and any suggestion that anything more than that happened on this occasion is wrong."

Turning to the specific claims about Mr Taguri, the peer said: "I have reviewed this evidence as the chairman of the general election (campaign). It is partial evidence, we haven't seen all the tapes, we haven't seen the context. But it is quite clear there are serious questions for Mr Taguri to answer.

"It would be quite improper for us ... if we investigated this ourselves. It must be done by an independent third party.

"The organisation charged with doing that is the Electoral Commission. We will now present them with all the evidence we have to hand. Mr Taguri will make himself available to the Electoral Commission.

"We will abide by any determination or conclusion that they reach."

Asked whether he thought Mr Taguri should be standing as an independent, Lord Ashdown said: "That's his choice ... he needs to understand that if he stands as an independent and then the party puts a candidate up in Brent, which I imagine we will, he will have to resign or be removed from the party membership if he did."

The undercover reporter was apparently able to secure meetings with senior figures including Mr Alexander after giving several thousand pounds and promising far more.

He was introduced to figures such as Lord Ashdown, taken to Mr Clegg's office and attended a dinner for major party benefactors where he met Mr Alexander, the newspaper said.

The fake donor is alleged to have been told by Mr Taguri that he could channel a donation via a "cousin" after explaining that he wanted to remain "discreet" about his financial support.

He went on to hand over a cheque for more than the £7,500 threshold beyond which donations must be publicly registered with the Electoral Commission.

Commission guidance, issued in 2007 in the wake of a scandal of "proxy" donations to Labour, says giving money via a third party "must not be used as an attempt to evade the controls on permissibility and transparency".

Mr Taguri told the newspaper he had not cashed the cheque, would have declared it according to the rules and believed the "cousin" referred to by the fake businessman had been giving his own money.

"I have been as transparent as I possibly can," he said.

He was also reported to have boasted that the party could be "very, very helpful once they know you are helpful" and suggested contacts that could be useful for dealing with particular issues raised by the supposed donor.

But he insisted he was only offering information to the reporter that was already available publicly and would have withdrawn himself from any possible conflict of interest if elected in May.

In a statement, Mr Taguri said: " I am happy to co-operate with any investigation and I am confident that I will be exonerated of all the claims made against me. Not only do I deny the allegations made against me I am capable of demonstrating that I have gone above and beyond the legal requirements in the interests of transparency.

"I will continue my campaign to become the next MP for Brent Central as an independent candidate with the intention of achieving the one thing I entered politics to do, to end child poverty in the UK by 2020.

"I look forward to clearing my name and returning to the Liberal Democrats."

The Scottish National Party candidate fighting against Mr Alexander for the constituency of Inverness, Nairn, Badenoch and Strathspey, Drew Hendry, said: "This latest episode is an extremely serious issue, apparently involving the Lib Dems at a very senior level seeking to break electoral law.

"Danny Alexander is at the centre of this dodgy donation scandal, and he must provide an immediate and full account of his role in it. The people of Inverness, Nairn, Badenoch and Strathspey deserve full disclosure from Mr Alexander about this murky matter.

"It seems that the Lib Dems are becoming increasingly desperate to get their hands on cash - regardless of where it is from."

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