UKIP could forfeit more than 350,000 pounds

LONDON (Reuters) - The UK Independence Party could be forced to pay back over a quarter of a million pounds in donations after it lost the latest stage of a legal battle on Monday.

A member of Britain's United Kingdom Independence Party (UKIP) wears a rosette bearing their emblem during a news conference in central London June 8, 2009. REUTERS/Toby Melville

A Court of Appeal ruling sided with the Electoral Commission’s view that UKIP received 367,697 pounds illegally from a donor who was not on the electoral roll at the time.

The case will now be sent back to Westminster magistrates for a new decision, based on the Court of Appeal findings, the Press Association reported.

Judge Sir Paul Kennedy said: “I can detect nothing which would entitle the magistrate’s court not to make the forfeiture order which the EC seeks.”

Political donors must be on the electoral register if they give more than 200 pounds, a measure designed to stop foreign donations to British parties.

UKIP, which has 13 MEPs and two House of Lords peers, admits breaking the law but said it was due to clerical error as the donor, retired bookmaker Alan Bown, had been mistakenly removed from the register at the time he gave the money.

In a 2007 ruling, Westminster magistrates held that although UKIP had not taken “all reasonable steps” to find out if Bown was on the roll, the error was accidental.

It said the party should pay back only 18,481 pounds, but the Commission bought a judicial review of that decision and the High Court ordered a fresh hearing.

“It would be foolish to second-guess what’s going to happen next but we are minded to fight,” a UKIP spokesman told Reuters.

Chief Executive of the Electoral Commission, Peter Wardle, said he is pursuing the case to clear up uncertainties over political donations.

“In this case, a party had accepted money that it should not have, but was allowed to keep most of it. These rules need to be clear, simple and easy to follow,” Wardle said in a statement.

Editing by Steve Addison