Keir Starmer announces temporary ban on crypto donations in blow to Reform

Sir Keir Starmer has announced a temporary ban on cryptocurrency donations to political parties, in a major blow to Nigel Farage’s Reform Britain, following a government review into political interference.

The government will also impose limits on donations from British citizens living abroad who are still on the electoral roll, according to a review by former home secretary Philip Rycroft.

Sir Keir told MPs the review had revealed the “serious threats posed by illicit finance”, hitting out at Mr Farage, whose party had accepted a number of crypto donations.

Last year Reform received around £12 million from Thailand-based British investor Christopher Harborne, as well as a number of smaller donations from abroad.

Iran, Russia and China are trying to “undermine” UK democracy, an independent review into foreign financial influence has warned.

He added that foreign interference in the UK was “real and persistent” and that the government should make it a “much higher” priority.

Sir Keir told MPs at PMQs that the government will “act decisively to protect our democracy; this will include a moratorium on all political donations made through cryptocurrencies”. He added: “I hope it will be welcomed.”

The announcement led to calls for Mr Farage to “refund all crypto donations he has received from anonymous overseas sources”.

Liberal Democrat cabinet spokeswoman Lisa Smart said: “Reform taking untraceable, secret crypto donations to fund his Trump-style policies here in the UK should never have been allowed. Farage must return all the crypto donations he has received from anonymous overseas sources or accept that he is happy to allow foreign sources of money to poison our politics in the UK.”

The report was ordered after Nathan Gill, the former leader of Reform England in Wales, was jailed for taking bribes to make pro-Russian statements while a member of the European Parliament.

The report also calls for a ban on foreign-backed online political advertising, suggests MPs’ trips abroad should be funded solely by the government or parliament, and warns of a “potential new threat” from the US.

In an indication of the scale of the problem, the report’s authors warned that social media posts about Scottish independence had fallen significantly recently after Iranian authorities cut off internet service within the country.

MPs were also called on to limit donations from British citizens living abroad.

Mr Farage was forced to defend the donation from Mr Harborne last year, insisting he “didn’t want anything from me”.

But the donation raised concerns about political financing, as Mr Farage publicly promoted Tether, the cryptocurrency company in which Mr Harborne is a shareholder, shortly after receiving the donation.

Former senior civil servant Mr Rycroft called on ministers to legislate for a moratorium on the Representation of the People Bill, which has passed parliament.

He wrote that this should not be seen as “the beginning of a complete and permanent ban” but rather as an interim period for regulations to catch up with reality.

“The government should enact the Representation of the People Bill to impose a moratorium on political donations in crypto assets,” he wrote.

Few parties accept crypto donations, but Reform UK is the most prominent party to do so.

Speaking to reporters, Mr Rycroft said he had spoken to Mr Farage’s party when preparing the report.

When asked about the Reform sentiment targeted by his crypto advice, he said: “I wasn’t here to look after the interests of any political party, I was here to look out for the interests of our democratic processes.”

Mr Rycroft said attempts to use financial influence to infiltrate politics by gaining influence and sowing division and distrust were not new, but were “arguably more severe”.

He said he was not “pressing the panic button” on the issue but was “ringing the alarm bell” and called on the government to “act quickly” in line with his recommendations.

Reform UK also received a second multimillion-pound donation from Bay Harborne. Months after giving £9 million to the party, he donated a further £3 million in November last year, according to the Electoral Commission.

Reform home affairs spokesman Ziya Yusuf described the announcement as “a dark day for Britain”.

He said: “Reform takes a large, perfectly legal donation from a British citizen and Labor responds by hastily introducing new legislation to ban him from making such a donation again.

“Rycroft even refers to British citizens as ‘malicious actors’ in his report. That’s how quickly the government machinery moves when it wants to protect itself.”

As for other countries, there are reports that the US government is trying to fund Maga-aligned think tanks in Europe as part of this strategy.

Mr Rycroft said: “What you have here is a clear national security statement to influence politics in Europe, and that clearly includes the UK.”