UK to ban crypto funding for parties

Britain will cap how much donors living overseas can give ‌to political parties and ban cryptocurrency donations following an independent review into the influence of foreign finance, a move that could hurt Nigel Farage’s Reform UK party.

The government ordered the review into foreign financial interference in politics after a former ​politician in Reform UK was jailed last year for taking bribes to make pro-Russia speeches ​and statements.

Last year, the populist Reform UK became the first British party to announce ⁠it would accept donations in the form of bitcoin and at least two-thirds of its money ​raised came from donors abroad.

Led by Farage, a friend of U.S. President Donald Trump, Reform is leading the ​governing Labour Party in opinion polls and raised more money than its rivals last year.

The government said it would cap donations by Britons living abroad at 100,000 pounds ($133,880) per year, and introduce a moratorium on crypto donations until a ​system to regulate them effectively was established, implementing the main conclusions of an independent review.

“We will stop ​hostile foreign states and others who want to weaken and exploit the UK by stoking division and hatred,” housing ‌minister Steve ⁠Reed said on Wednesday.

THREAT OF FOREIGN INTERFERENCE IS REAL, REVIEW SAYS

Reed said “a ban on cryptocurrency donations is vital” to shut off a “clear route” for channelling illicit funds into politics. He added the cap on donations and crypto ban would both apply from Wednesday.

In his review, a former senior government official Philip ​Rycroft said “the threat of foreign ​financial interference in our ⁠politics is real, persistent and sustained.”

There had previously been no limits in Britain on donations to parties if they come from individuals on the UK ​electoral register or from UK-registered companies or organisations such as trade unions.

Rycroft’s review ​said Britain ⁠faced a persistent problem of foreign countries, including Russia, China and Iran, trying to influence and undermine the country’s democracy and possible new threats from foreign actors and private citizens, including from “allies like the United States”.

In ⁠this environment, ​the review recommended creating a police centre to investigate allegations ​of foreign interference in politics, reduce the burden of proof for criminal offences and look at toughening sentences.

Reform did not immediately ​respond to a request for comment. ($1 = 0.7469 pounds)