Denis MacShane pleads guilty to expenses fraud
Ex-Labour minister admits making false claims to fund trips, during court hearing
The former Labour minister Denis MacShane has admitted filing nearly £13,000 of bogus parliamentary expenses. The ex-MP pleaded guilty on Monday to false accounting by entering fake receipts for £12,900 for “research and translation” services. He used the money to fund trips to Europe, including one to judge a literary competition in Paris.
Evidence suggesting MacShane’s guilt was reportedly uncovered by a Commons investigation in 2010, but remained hidden from police under the rule of parliamentary privilege. Refusal by the Commons to release the crucial material, it has been claimed, led to a police investigation into MacShane being dropped in 2012.
MacShane’s expenses have been under scrutiny for more than four years. The Commons authorities began looking at his claims when the scandal engulfed Westminster in 2009. They referred the matter to police within months of identifying potential criminal activity.
But the longstanding principle of parliamentary privilege, which is supposed to protect MPs’ freedom of speech, meant detectives had no access to damning correspondence with the then standards commissioner, John Lyon. In the correspondence, MacShane described how signatures on receipts from the European Policy Institute (EPI) had been faked.
The EPI was controlled by MacShane, and the general manager’s signature was not genuine. One letter, dated October 2009, described how he drew funds from the EPI so that he could serve on a book-judging panel in Paris.
Police could not prove any wrongdoing without the correspondence, and dropped their inquiry in July 2012. But the letters emerged in November last year when the cross-party standards and privileges committee published a report recommending a 12-month suspension from the house.
Friends of MacShane claimed that many other MPs had made similar claims and that the actual bogus claims were for considerably less than £13,000. “There was no row between the Commons authorities and the police. If there had been, he would have known about it,” a source said. However, prosecution sources said that there had been difficulties obtaining all the documents from Parliament.
MacShane, who served as Europe minister under Tony Blair, resigned as MP for Rotherham before the punishment could be imposed. He was charged in May, even though the letters are still thought to be inadmissible in court because they remain “privileged”.
The offence covered 19 receipts that MacShane filed between January 2005 and January 2008.
MacShane is understood to accept that he made a “grotesque mistake”. But he insists he did not make any personal gain from the claims. He has said he told the police “everything and more” than he told the standards commissioner before the criminal case was initially dropped.
Mr Justice Sweeney told the politician as he stood in the dock in court number two at the Old Bailey: “You will understand, I’m sure, that all sentencing options remain open to the court.” The maximum sentence for false accounting is seven years. MacShane is likely to get less.
He joins a list of politicians prosecuted as a result of the expenses scandal. They include his fellow former Labour minister Elliot Morley, Jim Devine, David Chaytor and Eric Illsley.
Tories to fall foul of the law were Lord Hanningfield and Lord Taylor of Warwick. Sentences have ranged from nine to 18 months’ imprisonment. Another ex-Labour MP, Margaret Moran, was spared prison and given a supervision order on the grounds of mental health problems.
Sentencing was adjourned until 19 December.