Monday, 23 July 2018

Campaign overspends? Try HnH's £208k undeclared expenditure!


Some food for thought, as Remainers forget their own campaign's fine and concentrate on errors in the Leave campaign. Hope not Hate failed to declare expenditure of over £200k in the 2014 European Elections, and while the time may have run out for electoral petitions, there is the associated fraud and false accounting which remains open. There is also the associated VAT bill which remains unaccounted for. For an organisation which sings so loudly about the shortcomings of its opponent's Electoral Commission returns, it is remarkably deficient in its own, and can hardly claim not to have known. 
Readers will notice undeclared expenditure to a company called Blue State Digital - we have mentioned them previously. Blue State Digital are the 'liberal' left's very own Cambridge Analytica, but nobody is much interested in reporting on them despite their client list including the Democrats, the Clinton Campaign, Labour, Barak Obama, Hope not Hate and a host of other left-leaning organisations. 

Hope not Hate ‘drove coach & horses’ though electoral & charity rules in Euro elections


30th September 2015

Anti-UKIP group Hope not Hate spent almost double the legal maximum on their campaign to halt the advance of Nigel Farage’s party in the 2014 European Elections, it was revealed today.

Despite strict spending limits for third party campaigners in elections the group spent at least £320,000 in its unsuccessful campaign while concealing the sources of its funding. The legal maximum it was permitted to spend was £195,759 across the UK, with a limit of £159,750 in England[1]. Hope not Hate declared electoral spending of only £129,984.05 for the entire campaign across the UK.

Researchers discovered that the bulk of the overspend related to an 8 page wrap on the Daily Mirror issued shortly before polling day and their failure to declare its true cost, which on its own was sufficient to exceed the spending limit. According to Trinity Mirror group’s advertising rate table, the cost of a 4 page wrap is £220,000[2], and yet for a wrap double this size Hope not Hate were only billed £54,434 split over 2 invoices[3].

Under electoral legislation, spending has to be declared at market value: where a discount is given over standard cost, this discount has to be declared as a donation in kind[4]. Hope not Hate declared no donations for the entire campaign despite receiving a discount of up to £ 165,566 on the cost of the wrap, and even this figure fails to take into account their VAT liability which would amount to a further £33,112.20.

Further problems were also apparent within the accounts submitted to the Electoral Commission. These included a failure to include spending to US based consultants Blue State Digital for electronic campaigning from the beginning of the restricted period of the elections on 23rd January through to March, which accounts for a further £ 7279.99 of undeclared expenditure during February and £2,119.35 for January based on declared expenditure[5].

Researchers also questioned the role of Ruth Smeeth, who remains listed as secretary of Hope not Hate Limited on its Electoral Commission registration despite having been elected as the Labour MP for Stoke on Trent North in May 2015. She was previously the Deputy Director of Hope not Hate[6] and she was also listed as the company secretary of Hope not Hate Ltd at Companies House from September 2012 until her resignation in March 2015[7], although the formal notice of her resignation was not filed with Companies House until the 3rd September 2015[8]. The Institute of Directors, quoting the Cadbury Report on Corporate Governance of 1996, states that company secretaries’ duties include “The chairman and the board will look to the company secretary for guidance on what their responsibilities are under the rules and regulations to which they are subject and on how these responsibilities should be discharged”[9]

Smeeth was also listed at Companies House as the secretary of Hope not Hate Educational Ltd, the charity arm of Hope not Hate until her resignation in March of this year[10], although this is not reflected in their Electoral Commission return[11]. Smeeth has been replaced by Elisabeth Pop, who is currently on secondment to British Influence from Hope not Hate Educational, which is paying her salary while she is there: something which would appear to be precluded by the charitable status of Hope not Hate Educational.

Pop is spearheading Hope not Hate Educational’s ‘Together’ campaign. Ostensibly a function of the charitable arm, it has increasingly been used to target UKIP. In Pop’s own words in 2014, “Thurrock has a long history of British National Party, National Front and now UKIP activity support, so this is one of the most challenging areas in which to work.... Building on our community canvass in late August, which saw 350 people sign our TOGETHER pledge, we encouraged voter turnout in a recent council by-election”[12]. Hope not Hate (under its previous registered name, Searchlight Educational Trust) have previously been warned by the Charity Commission about the need to keep a clear separation between charitable and campaign activities[13]. The report found that:

8. There was no reference on the website to the Charity’s registered status, the charitable objects were not stated and it was not made clear that the Charity is distinct from the magazine and from SIS.

9. All three organisations shared a telephone number and postal address. This caused further confusion regarding the separate objects and activities of the charity and the two companies.

10. The Charity had yet to implement some of the recommendations previously made by the Commission, during a Visit to the Charity in 2001.

While these issues were addressed, there has been considerable backsliding since the split from Searchlight and the establishment of Hope not Hate as an independent entity in 2011. This includes a running together of the charity and the campaign organisation’s output on the Hope not Hate website where it is all published under the single banner of ‘Hope not Hate’. It is unclear – as both Hope not Hate Ltd and Hope not Hate Educational Ltd hide their addresses behind PO Boxes – whether they share premises, although as both PO Boxes are at the NW9 3RE Mail Delivery Centre it would appear likely. Certainly Hope not Hate used an address at the WAC Arts Centre during the 2014 European Election campaign which was sub-let from Hope not Hate Educational[14] and there was considerable cross-over of staff with the charity sub-contracting its staff to Hope not Hate[15]

This is particularly pertinent to the ‘Together’ campaign. Although Hope not Hate Educational is registered with the Electoral Commission, it has failed to file any reports. Meanwhile, the ‘Together’ project is funded at least in part by a £50,000 donation from US charity ‘Unbound Philanthropy’ according to accounts filed with the Charity Commission for 2014[16], although Unbound Philanthropy’s own accounts show the amount actually donated was £ 200,000[17] on the 24th February 2014. Either way, it is questionable whether Unbound Philanthropy is a permissible donor under UK electoral legislation as it is registered with Companies House only as an overseas corporation with no UK address[18]. Hope not Hate Educational also received a grant of £120,000 from Unbound Philanthropy in on 26th February 2012[19] for work over the period 2012-2014, although this payment does not appear in accounts filed by Hope not Hate Educational Ltd with either Companies House or the Charity Commission[20].

Offences

In respect of the 2014 European Elections, there appears to be (including VAT) £ 208,078.54 in unreported expenditure, of which £ 198,679.20 is also an unreported donation. Inclusion of these items in total reported expenditure would bring the total expenditure to £338,069.52, against an allowable expenditure across the UK of £195,759 – a total overspend of £142,303.59.

Likely offences under Schedule 20 of the Political Parties, Elections & Referendums Act[21]:

Section 86(8) (making false declaration about value of property etc)
On summary conviction: statutory maximum or 6 months
On indictment : fine or 1 year
Section 94(2) or (4) (exceeding limits on controlled expenditure)
On summary conviction: statutory maximum
On indictment : fine
Section 98(4)(a) (failure of responsible person to deliver return and auditor’s report to Commission)
On summary conviction: Level 5
Section 98(4)(b) (failure to comply with requirements for returns)
On summary conviction: statutory maximum or 6 months
On indictment : fine or 1 year
Section 99(4)(a) (making a false declaration to Commission when delivering return)
On summary conviction: statutory maximum or 6 months
On indictment : fine or 1 year





This list covers only some possible offences under the PPERA, and excludes the acceptance of money from impermissible donors via Hope not Hate Educational Ltd. There are other offences under Charities legislation, and further offences under the Companies Act relating to false accounting, money laundering, making false statements etc.


[8] http://tinyurl.com/nac3gav - Smeeth resignation document at Companies House

[16] http://tinyurl.com/o9j5ajj Hope not Hate Educational 2014 Accounts Charity Commission
[17] https://www.unboundphilanthropy.org/sites/default/files/Full%20Grants%20list%206-8-15.xlsx Hope not Hate Educational £200,000 grant appears on Line 19.
[19] https://www.unboundphilanthropy.org/sites/default/files/Full%20Grants%20list%206-8-15.xlsx Hope not Hate Educational £120,000 grant appears on Line 68
[20] http://tinyurl.com/q7odvqa  (2012 Accounts) and http://tinyurl.com/otz5sej  (2013 accounts) (both Companies House – the same accounts are filed with the Charity Commission).
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