Monday 14 March 2022

Identifying the transaction

 

There is a scene in The Godfather where an undertaker asks a favour from the mafia boss which involves something ‘unpleasant’ happening to a third party. The favour is granted willingly and unconditionally, with a simple statement that, at some future date, the Godfather might well need a favour from the undertaker – and some years later, that is precisely what happens when the undertaker is asked to patch up the body of the Godfather’s hot-headed son before his mother sees it. Two unrelated favours, in a sense – but there is a transaction hidden there, and all involved know it, even if it would be difficult to prove to the standards of a court of law.

Political donations can work in a similar way, and the transactional nature of some of them is also very difficult to prove. Take the case of Alexander Temerko and his company, Aquind. Both have been making generous donations to the Tory Party and an assortment of ministers and MPs (including Welsh Secretary, Simon Hart) for some years, involving a total of £1.1 million. The money was always given as ‘no strings’ donations, of course, out of the heartfelt generosity of Temerko and the ultimate owner of Aquind, Viktor Fedotov (although the latter denies having any control over the donations). One of the other beneficiaries was Penny Mordaunt, who now seems to have incurred the ire of Temerkov by daring to campaign against a business project of his. His response was to describe her as an “absolutely uncontrollable woman” – clearly, he expected that she would be more ‘controllable’. I wonder what could possibly have led him to think that? This case has come to light because an MP has NOT done what was clearly expected of her – in how many other cases have MPs discovered that their views on particular projects just happen to align with those of donors?

The issue here is nothing to do with the nationality of those involved – Temerko is Ukrainian-born, as it happens, although with strong links to Putin’s Kremlin, even if Fedotov is Russian. The issue predates the current hostilities which are leading to some people asking more questions, albeit late in the day. Having said that, it’s always possible that oligarchs used to operating in a political culture where politicians do what they are paid to do may have greater expectations of subsequent compliance than those used to operating in a less overtly corrupt political culture. The question, though, is a broader one – the fact that there are no conditions imposed at the time of making donations to influential politicians doesn’t mean that a return favour might not be requested or expected, even if not until some years later; and politicians who accept large sums, especially from dodgy sources (and surely donations from companies with no obvious source of revenue ought to provoke a question or two, at least) should ask themselves why they are being given the money rather than enthusiastically accepting it because ‘no rules have been broken’. Might there just possibly be unstated expectations for the future?

Lawyers for Aquind have said that all donations were “entirely lawful, properly declared and have not been made in return for any special treatment”, and doubtless they are correct – there was no clear ‘transaction’ involved in any of them. The same thing could be said in relation to the case of the Godfather’s favour to the undertaker. But it doesn’t take a lot of thought to work out what might have become of that undertaker had he refused to return the favour when requested.

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