Tories urged secrecy over gift: Exclusive: Former Nissan UK chief accused of tax fraud put money into offshore accounts to gain influence

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The Independent Online
CONSERVATIVE party officials asked Octav Botnar, former head of car dealer Nissan UK, to channel substantial donations to the party through secret offshore bank accounts so they could not be identified. The Independent has also learnt that two former Tory cabinet ministers - Lord Tebbitt and Lord Parkinson - interceded on behalf of Botnar when his business was on the verge of collapse in 1991.

An arrest warrant has been issued for the 79-year-old tycoon for alleged tax fraud involving more than pounds 97m. Like Asil Nadir, who claims to have given pounds 1.5m to Tory funds, Botnar has fled British courts and is now in Switzerland. It has emerged that Botnar sponsored annual lunches for the Cities of London and Westminster Conservative Association. The total worth of his sponsorship to the Tories was more than pounds 90,000. The last lunch took place several weeks after the Inland Revenue had raided the Worthing offices of Nissan UK in June 1991. Business associates in attendance said that Tory officials were happy to allow the lunch to go ahead because the company shown sponsoring the lunch was Automotive Financial Group Holdings, a company controlled by Botnar, but not Nissan UK.

The Independent has learnt that, in addition to this sponsorship, Botnar donated pounds 50,000 in the financial year 1981-82 and a further pounds 100,000 in the following year. The money was donated into a secret offshore account held by the Tory party in Jersey. This, according to business associates closely associated with him at the time, was at the suggestion of senior Tory party officials.

Sources claim that this was preferred to a less confidential donation made to one of the party's mainland funds, such as the Industrial Fund, because of rumours of alleged unethical business practices in Nissan UK.

It is not clear whether the donations came from Botnar's private funds, or were drawn from his companies. In either case, they would not have been illegal.

The Tories have admitted receiving pounds 440,000 from Nadir, most of which is alleged to have been stolen from his company accounts. Botnar was not available for comment yesterday.

Botnar, once one of Britain's wealthiest businessmen, has said that he does not intend to return to the UK to face trial for alleged tax fraud because doctors have advised him that he is not well enough to travel. He has denied any wrongdoing and alleges, echoing the claims made by Nadir, that his business was undermined by a conspiracy that involved the British government. Botnar began his association with the Tories during the 1970s when he lobbied for an end to the quota system which restricted the volume of Japanese cars that could be imported into the UK. After the Tories' election victory in 1979, the entrepreneur campaigned for the construction of a Nissan factory in the UK, and an end to the quota.

A business colleague said: 'He used to bully me to get him a handful of Tory MPs to sit on his board. I said that's not possible. Then he hit on the idea of donating to the party as a way of acquiring influence.'

During the 1980s, he became acquainted with a number of senior Tories, including Lord Parkinson, who was chairman of the party between 1981 and 1983, and Lord Tebbit, when he was Secretary of State for Trade and Industry. Both offered to help to arbitrate with Nissan when it decided to terminate the contract with Botnar's company in the UK in December 1990. Lord Tebbit said last night that he had written to Nissan and Botnar offering to mediate. His offer was declined. Asked if he knew of Botnar's donations, he said: 'I can't remember if I was aware or not. A hell of a lot of people do contribute; that was a peripheral matter.'

Lord Parkinson denied that his offer of mediation had anything to do with Botnar's donations. He said that he, as chairman, had no knowledge of such donations.

Savoy lunches, page 3

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