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LONDON—British police said Thursday they had opened an investigation into one of the main financial backers of the campaign to persuade voters to leave the European Union in 2016.
The probe into Arron Banks comes after U.K. lawmakers raised the alarm over his alleged links to Russia, and Britain’s electoral watchdog flagged concerns about the true source of the money Mr. Banks pumped into a leading pro-Brexit group.
It also comes against a backdrop of widening scrutiny in Western capitals over suspected Russian attempts to influence elections, including in the U.S.
Mr. Banks, 52 years old, is under investigation for suspected breaches of electoral law, the U.K.’s National Crime Agency said Thursday. It added, without being specific, that other crimes may also have been committed.
The agency, which investigates only serious offenses such as organized crime, said the probe also covers the pro-Brexit campaign group Leave.EU, for which Mr. Banks serves as chairman, and other related companies and individuals.
In a statement issued by Leave.EU, Mr. Banks denied the accusations and said he expected to be exonerated. “I am a U.K. taxpayer and I have never received any foreign donations,” Mr. Banks said.
He added the NCA investigation reflected “political pressure” from those opposed to Brexit.
The investigation stems from an earlier probe by the U.K.’s Electoral Commission into loans made by Mr. Banks to Leave.EU and associated entities during the 2016 referendum campaign. Mr. Banks lent £8 million ($10.2 million) to Leave.EU and another company called Better for the Country Ltd. to cover campaign expenses.
Mr. Banks declared that the money was his, but commission concluded that “Mr. Banks was not the true source of the £8 million reported as loans,” and alleged he and others “concealed the true details of these financial transactions” from regulators.
It also said one of the parties to the transactions was an Isle of Man-registered company that wasn’t permitted to participate in funding the campaign under British electoral law, which bars foreign lending to political campaigns.
Records show campaigners on both sides of the referendum debate received donations and loans totaling £37 million during the six-week campaign leading up the June 2016 vote.
Mr. Banks has emerged over the past decade as one of Britain’s most maverick political operatives. He made his fortune in insurance and from 2014 was a significant donor to the anti-EU U.K. Independence Party, which agitated for Britain’s exit from the bloc.
His activities came under scrutiny from a Parliamentary committee that after the 2016 Brexit referendum began examining disinformation and alleged Russian meddling in British affairs. In his testimony to the panel, Mr. Banks jokingly compared himself to a James Bond villain.
“I like to think I am an evil genius with a white cat that controls the whole of western democracy, but clearly that is nonsense,” he said.
In a July report, lawmakers on the committee expressed doubts that Mr. Banks was the source of the £8 million loan to Leave.EU and that the money was sourced from the U.K. They urged the Electoral Commission and law-enforcement officials to investigate.
The report detailed repeated contacts between Mr. Banks and the Russian embassy in London, including discussions over possible business deals in Russia involving gold and diamond mines. Mr. Banks has denied he has done any Russian business deals.
Damian Collins, a lawmaker in Prime Minister Theresa May’s ruling Conservative Party who chairs Parliament’s culture committee, said he was pleased the NCA is looking into Mr. Banks. “These are serious issues that should be fully investigated by the NCA using all their powers,” he said.
—Paul Hannon contributed to this article.
Write to Jason Douglas at [email protected]
