THE Tories are facing mounting pressure to return donations received from Lycamobile after its French entities were convicted of fraud in a Paris court, reported the Financial Times.
The UK-based global mobile network operator had gifted £2.15 million to the Tories between 2011 and 2016, as per records from the Electoral Commission.
In a ruling by the Paris criminal court on October 26, Lycamobile’s French corporate divisions were found guilty of committing VAT fraud and money laundering. This conviction resulted in a £8.7 million fine, with appeals from Lycamobile France against the convictions.
The former CEO, Christopher Tooley, and Alain Jochimek, head of the French business, received sentences related to the fraud.
Tooley was handed a suspended jail sentence and a fine, while Jochimek was sentenced to three years, which could be served under electronic monitoring, along with a fine. Both men are appealing these sentences.
Following the verdict, the Tories are being urged to return the money received from Lycamobile.
The Liberal Democrats’ Cabinet Office spokesperson, Christine Jardine, called for an independent inquiry and questioned the acceptance of donations after serious allegations arose, the FT report said.
Jardine raised concerns about the Tories accepting donations even after reports of money laundering allegations in the press in 2015 and charges by French prosecutors in 2016.
She pressed for reassurance that the Tories would not retain the £2.15m from Lycamobile in light of the French court ruling.
Additionally, reports surfaced that in 2017, HMRC declined a request by French officials to raid Lycamobile’s London offices. Jardine highlighted these events, suggesting a potential connection between Lycamobile’s donations and HMRC’s decision, warning of potential damage to public trust in politics.
A Tory official stated that all donations were transparently declared and complied with Electoral Commission rules.
The Paris court judgment accused Lycamobile of deceiving tax authorities by misusing VAT rules and knowingly participating in a complex money laundering system between 2014 and 2016.
Lycamobile has maintained its innocence, claiming victimisation by organised crime and aims to defend itself in higher courts.
The company has not responded to a request for comment from Eastern Eye.
In February, the owner of Lycamobile, Allirajah Subaskaran, has found himself at odds with accountants after tax authorities demanded £100m from his company over alleged VAT anomalies.
According to auditors to Lycamobile UK Limited, they were “unable to obtain sufficient appropriate audit evidence” in connection to loans amounting to £18m the company made to Subaskaran and P Subaskaran, believed to be the former’s wife Premantharsini Subaskaran.
Besides, recent corporate filings showed that another £169m of debts owed by an intricate network of connected party companies could not be verified either.
British-Sri Lankan tycoon Subaskaran founded Lycamobile in the mid-2000s and it specialises in affordable pay-as-you-go sim cards for those who plan to make calls in the UK as well as abroad. It claims to be the world’s largest mobile virtual network operator with a customer base of more than 16 million and a new customer coming in every two seconds.
