A millionaire businessman whose company donated more than £2 million to the Liberal Democrats has been extradited.
The businessman is being extradited back to the UK. Photo: The Times
Michael Brown, who was based in Spain, is expected to appear before magistrates in London later.
Mr Brown is facing fraud charges brought by the HSBC bank. The case does not involve the Liberal Democrats.
A spokesman for Mr Brown told the BBC that the businessman would vigorously defend himself against whatever charges were levelled against him.
The City of London Police issued a statement which said: "A 40-year-old British man has been extradited back to the UK following his arrest in Madrid by officers of the City of London Police economic crime department assisted by the Spanish authorities."
It said the extradition took place in cooperation with the Crown Prosecution Service with regard to a private prosecution.
The statement added: "The man arrested is currently under investigation by the City of London Police's money-laundering investigation unit in connection with large-scale suspected fraud."
Police also confirmed that a small number of high profile and wealthy victims have been targeted and added that further arrests had been made in the UK.
Mr Brown, a 40-year-old tax exile, is one of Scotland's wealthiest men, with an estimated fortune of about £10m.
He was the subject of an Electoral Commission investigation last year after it emerged he was not registered vote in the UK - despite bankrolling the Lib Dems' election campaign.
But the watchdog later found it was "permissible" for the party to have accepted the cash from the financier's UK-based company 5th Avenue Partners Ltd.
He later said he gave the money because he believed in then leader Charles Kennedy's ability as a future prime minister "but not the muppets who purport to serve him".