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Last Updated: Thursday, 30 March 2006, 18:29 GMT 19:29 UK
Police loans inquiry is widened
The Houses of Parliament
The loans probe has become a cross-party inquiry
Police inquiries into the alleged sale of peerages are to be widened to look at other political parties.

Scotland Yard is refusing to say which other parties it is targeting but it is understood it is investigating the Tories and at least one other party.

Until now the Metropolitan Police has only looked at complaints concerning the Labour Party.

But Labour MP Rosemary McKenna has asked the force earlier this week to investigate the Tories as well.

She wrote to Deputy Assistant Commissioner John Yates calling on him to investigate whether the Tories had effectively received illegal foreign donations through "soft" loans from backers overseas.

The Conservatives insist they have kept to the rules but say they will cooperate with any police investigation.

Naming names?

The Metropolitan Police's specialist crime directorate is heading the inquiry.

It is understood the decision to widen the inquiry is partly, but not entirely, the result of the new complaints.

News that the investigation is becoming a cross-party affair comes as the Tories are asking people who have lent them money for permission to publish their names.

The party had resisted the move, saying the lenders had a right to anonymity. Labour has already named the 12 people who secretly lent it a total of 14m in the run-up to last year's election.

Watchdog's warning

On Wednesday the Electoral Commission said it was not yet satisfied that the multi-million pound secret loans to parties were within the funding laws.

Its chairman, Sam Younger, told BBC News he would use legal powers if necessary to make parties open their books.

The police have also said their probe could investigate wider corruption claims amid questions about how big donors received govermnent contracts.

All the political parties and the people who have lent or donated money have denied any favours were given for the loans.

Labour and the Conservatives have said all undeclared loans in last year's general election campaign complied with the rules covering party funding.

The Lib Dems says they did not benefit from such loans.

The commission says doubts over whether the loans were really on commercial terms were raised by reports quoting both lenders and party representatives.

Peerage nominations

Meanwhile, Chai Patel, who lent Labour 1.5m, has withdrawn his name from Tony Blair's list of nominees for a peerage amid the "cash for titles" row.

The millionaire businessman said that at no time did he have any expectation of a reward nor had he been offered anything in return.

His nomination to become a Labour peer was blocked by the House of Lords Appointments Commission.

Three other millionaires who lent the Labour party money and who were nominated for peerages - Sir David Garrard, Gulam Noon and Barry Townsley - have already withdrawn their names from the list.

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