Tories covered up cash donations from Zac Goldsmith

The Conservative party hid donations of £40,000 from Zac Goldsmith, his brother Ben and two billionaire brothers in an apparent breach of the law.

The donations were recorded on official records as coming from Unicorn Administration, an intermediary company that helps run the finances of the super-rich.

But The Sunday Times has discovered that in fact they came from Zac Goldsmith, his brother Ben, and Ben's wife Kate, a member of the Rothschild family. Another donation of £14,390 came from the Reuben brothers, property developers and aluminium tycoons who made a fortune in Russia.

Goldsmith, the Conservative parliamentary candidate for Richmond Park, correctly informed the party that payments of £12,310, channelled through a wealth management firm called Unicorn Administration, were from him.

There is no suggestion that any of the donors or Unicorn acted improperly. But the Tory party failed to tell the Electoral Commission, the official watchdog, even though electoral law makes it clear that the true source of funds must not be concealed.

Between 2005 and 2008, five different payments were given to central party funds and to the local party of Michael Gove, the shadow children's secretary.

In each case, they were declared to the Electoral Commission under the name of the proxy donor, Unicorn Administration.

A scandal about proxy donations hit Gordon Brown at the start of his premiership when it emerged that David Abrahams, a property developer, had given more than £500,000 to Labour through third parties.

The Tory party admitted it had made administrative errors and would investigate this week. It denied any intent to conceal the donations. The Electoral Commission is also expected to investigate.

This weekend Lord Oakeshott, the Liberal Democrat Treasury spokesman, said he would write to the Electoral Commission calling for an inquiry into the apparent breach of electoral law.

He questioned whether the registration of the donations by a proxy donor was due to error. "Back-door gifts through front companies blatantly break the spirit of the law on cleaning up Britain's moneybags politics," he said.

"If the Conservative party have nothing to hide, why not declare straight out they're [Goldsmith's] thousands instead of using the cover of Unicorn Administration? It is hard to see how these can be simple errors. Why was there a pattern of donors using Unicorn before they made donations in their own name?"

At the time of these proxy payments through Unicorn, there had been no publicly declared donations to the Conservatives by the Reuben brothers or Kate Goldsmith.

The Reuben brothers made the £14,390 donation in March 2006 via their company Motcomb Estates. They did not make a registered donation to the Tories either through Motcomb or any of their other companies until 2007.

Zac Goldsmith gave to Gove's local party in 2005 through Unicorn, but his first direct registered donation was made in 2007. Kate Goldsmith gave £2,250 to the Tories through Unicorn in December 2006, but her first registered donation was only made in 2007.

A Conservative party spokesman said some of the donations were made as auction bids and sponsorship at events such as the Black and White Ball. A spokesman blamed mistakes for failing to register them properly but said they had now all been declared as Tory donors.

"It appears that there may have been an administrative error in registering these donations," he said. "We are taking immediate steps to investigate it and rectify the declarations as necessary. Clearly, there was no motive of concealment since all those on whose behalf Unicorn was acting have already been made public as donating to the party."

Charles Filmer, founder of Unicorn Administration, initially implied that the donations were from Unicorn. He later stated that the Conservative party was told that some of the payments sent via his firm were actually from Goldsmith.

He said: "Unicorn has many clients, including some members of the Goldsmith family. Of these donations, £12,310 represents donations made on behalf of Zac Goldsmith to the Conservative party. The Conservative party was made fully aware at the time that Unicorn was handling payments on Zac's behalf."

Goldsmith's three donations were on cheques written out from Unicorn Administration, but the cheques said on the top "from Zac Goldsmith".

His first donation, made in April 2005 for £2,000, was given to Surrey Heath Conservative Association to help Gove fight the seat at the 2005 general election. Gove denied he knew the donation was from Goldsmith, but said he had checked with the party that it was from a legitimate source and was satisfied it complied with the rules.

Zac Goldsmith's brother Ben also gave £10,000 to the Conservative party via Unicorn in June 2008.

Filmer, a former cavalry officer, was adviser to Sir James Goldsmith, the billionaire late father of Zac. His firm caters to the needs of the super-rich, including budgeting to buy mansions and yachts and drawing up pre-nuptial contracts.

A spokeswoman for the Electoral Commission said: "A person giving money to a party on behalf of someone else is acting as an agent and must inform the party that they are doing so.

"The party must then report the details of the original source to the Electoral Commission in their quarterly returns. The original source is the name that must be published on the registers on our website ."