The Metropolitan Police has said that there is “no credible evidence of criminality” following an investigation into allegations that the London Borough of Tower Hamlets gave out charity grants to gain electoral success.
Communities Secretary Eric Pickles started an investigation following a BBC Panorama programme on Lutfur Rahman, the mayor of Tower Hamlets council, who, it alleged, doubled grants awarded to Bengali-run charities in return for votes.
Pickles appointed PricewaterhouseCoopers to look into allegations of poor financial management, involving charity grants, at Tower Hamlets council.
The Metropolitan Police Service said that it had reviewed files of material from the Department of Communities and Local Government relating to the London Borough of Tower Hamlets over the last six days.
In a statement it said: “There is no credible evidence of criminality within the files to provide reasonable grounds to suspect that fraud or any other offence has been committed at this stage.
“Therefore the MPS will not be investigating at this point in time and believe that it is appropriate for the material to be reviewed further by PwC and DCLG. We will continue to liaise with them should their audit uncover any evidence of criminality.”
A spokesperson from Panorama said:“We continue to stand by the programme’s findings which uncovered serious concerns about the use of public money, which are still being investigated by the government.
"Our programme did not say there was evidence of criminality. The allegations relate to potentially unlawful expenditure, not to a criminal matter.
"For the avoidance of doubt, the Metropolitan Police were not investigating allegations made within the Panorama programme, and any such claims are misleading.”
Rahman had denied all of the allegations levelled at him by BBC Panorama. He says the programme was used for political campaigning and electioneering purposes weeks before local and mayoral elections in May.
A council spokesperson said: “The news from the Metropolitan Police is to be welcomed and Tower Hamlets will continue to work with the Auditors and DCLG."
The BBC Panaroma programme said that opposition councillors believed the grants were made in return for electoral support.
Panorama found that council officers in Tower Hamlets proposed that Bengali and Somali groups receive £1.5m. But a review by Panorama of 362 grants approved by the mayor found that he increased funding to these organisations by nearly two-and-a-half times - to £3.6m.
