Nineteen people have been arrested and nine of them charged with money laundering after BuzzFeed News revealed Lycamobile’s “deeply suspicious” cash movements.
The Conservative party’s biggest donor, the telecoms giant Lycamobile, has been raided by French police on suspicion of money laundering and tax fraud, BuzzFeed News can reveal.
Nineteen people were arrested in Paris last week and nine of them were charged on Friday, including Lycamobile’s general manager in France, Alain Jochimek.
The investigation was launched in the wake of revelations by BuzzFeed News last year that the international telecoms group employs three cash couriers to drop rucksacks stuffed with hundreds of thousands of pounds twice a day at Post Offices scattered across London.
Almost €1 million was seized in raids on Lycamobile’s Paris headquarters and a series of residential and business addresses across the city, and the group’s French bank accounts have been frozen.
Among those charged along with Jochimek were cash collectors working for the company, officers of smaller companies that allegedly made illicit payments into Lyca’s accounts, and a couple suspected of acting as conduits to criminal networks.
The Conservative party has accepted donations of more than £2.2 million from Lycamobile. Its Sri Lankan-born owner, Subaskaran Allirajah, is a member of the exclusive Leader’s Group for top donors and has dined privately with the prime minister or members of his cabinet twice in the past six months. He is also close to Boris Johnson after bankrolling his London mayoral campaign.
Lycamobile has not responded to repeated requests for comment about the raid, but sources say Jochimek denied all the allegations and the other people charged could not be reached. The company has always previously insisted that its business is wholly above board and denied allegations of financial malpractice. It said the cash drops caught on film last year were just “day-to-day banking” of legitimate takings from the sale of its international calling cards.
Now the French authorities have identified payments into Lyca’s accounts from “shell” companies suspected of acting as fronts for “various networks laundering profits from crime” in intelligence documents compiled by the country’s financial crime unit.
The charges brought in a Paris court on Friday relate to alleged illicit transactions of €17 million but documents reveal the French authorities suspect the true total is much larger.
BuzzFeed News has visited 19 companies that allegedly funnelled tens of millions of euros into Lycamobile’s French accounts and found that all but one were registered at PO boxes, vacant offices, derelict buildings, or a construction site. At none of these locations was it actually possible to buy any Lyca products.
Lycamobile’s explanation for the payments is not yet known. A source close to the investigation told BuzzFeed News that prosecutors have not established the origin of the funds.
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