National Plant and Transport Plc (NPT), owned by a Nottingham family which helped to break the 1984 miners' strike, left debts of pounds 15m - including a pounds 500,000 dividend owed to the UDM - when it crashed in February. Among items that may have to be sold to pay creditors are a yacht, a Cessna light aircraft and a farm.
The UDM, which played no part in the alleged fraud, owned 49 per cent of Mining Skills, a subsidiary of NPT plc which was set up in 1989 to carry out contract work for British Coal in Nottinghamshire.
A secret Mining Skills bank account was instrumental in the alleged theft of at least pounds 1m of British Coal money destined for the Lloyds subsidiary.
Mining Skills was the union's first commercial venture. Officials have admitted they were 'nave' in establishing a company in which they had only a 49 per cent stake and which was part of a group of four other NPT companies over which they had no control.
The group was owned by members of the Meeks family which sprang to prominence in 1984 when Eric Meeks ran fuel convoys in south Wales through National Union of Mineworkers picket lines. His son, Robin, 38, who held the extra share that gave NPT Plc control of Mining Skills, is being sued for pounds 6.5m damages for breaching his responsibilities as a director.
Nottinghamshire police deny there is an investigation, but it is understood that fraud squad officers moved into the NPT premises last week.
Among a string of fraud allegations, they will examine the alleged theft of pounds 4m from Confidential Invoice Discounting, a subsidiary of Lloyds Bank, and several hundred thousand pounds from RoyScot, a subsidiary of the Royal Bank of Scotland. The claims relate to the alleged collection by NPT of debts which it had already 'sold' to the two companies, and the creation of false invoices.
Despite losing an expected dividend of pounds 500,000 for this year, Mick Stevens, general secretary of the Nottinghamshire area UDM, said the union had benefited from its involvement with NPT. 'There may have been some mistakes. But our investment was pounds 20,000 and we made more than pounds 80,000 in the first year alone.'
The Independent has obtained a confidential letter from Dan Crompton, the Chief Constable of Nottinghamshire, to Paddy Tipping, MP for Sherwood, confirming the investigation.
'Fraud squad officers have just commenced an investigation and the early indications are that the inquiry will be lengthy and the alleged extent of fraud is considerable,' he wrote.
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