Michael Levy

Michael Levy is one of the most important fundraisers for the Labour Party and was formerly Tony Blair's unofficial envoy to the Middle East. He was questioned and arrested over the Cash-for-Peerages Scandal. Levy is reported to be 'euphemistically known as the Man with the Midas Touch' through his 'revolutionising' of the Labour Party's fundraising. This has also led him to be referred to as 'Mr Cashpoint'.

Levy is described as coming from a 'close and devoutly religious family' and being raised 'in austere circumstances'. His father was a synagogue attendant and his grandfather was a rabbi. He spent his youth in Stoke Newington and attended The Grocers (a school that later became Hackney Downs grammar).

Levy's British home (in the 'well known retreat of the capital's millionaires' of Totteridge Common in North London) has received a £1.3m renovation. The property is descibed as being 'hacienda style', with 'white walls under a red-tiled roof, palm trees, a tennis court and swimming pool. There are five large bedrooms, three sitting rooms, a games room and a garage large enough for several luxury cars. Domestic staff have a separate annexe'. The inside is decorated with marble, granite and limestone with designer furniture. According to one visitor, 'is not so much a home as a very expensive hotel'. Levy and his wife 'became the popular hosts of parties for carefully selected guests'. In the words of one guest, "It was always sensible to accept an invitation because you knew that you would meet leaders from entertainment, business and politics... he was a social and political magnet."

Levy is reportedly known for his uncompromising attitude and has been described by his long-time friend Rea as "extremely tough. One of the hardest bastards I have ever met..."

Citizen Levy

He set up Magnet Records in 1972 with help from Maurice Oberstein, Head of CBS Records, and made millions from artists like Alvin Stardust, Chris Rea, Dollar, Darts and Bad Manners, at one point was selling 8% of all records in the UK. Some former employees of Magnet have complained that he was a tyrant who shouted at staff and threw ashtrays around. He was known for his 'outgoing personality', for his 'forceful, often uncompromising style' and also for his ability to 'charm'. He sold Magnet to Warner Brothers in 1988 for £10 million and later set up another record company called M&G (named after himself and his wife Gilda), where he paid himself a salary of £308,657. He sold M&G in 1997. It is reported that it was the death of his mother (who had been in a coma for 6 weeks) that had prompted his change of direction away from the music industry. It is claimed that he had a 'life changing experience' as he was convinced that she was sending him messages to 'turn his talents from pop music to good causes'. So in 1990 he became involved with Jewish Care after being approached by its president Lord Young. Jewish Care is 'one of Britain's biggest private charities' (Spending approximately £40m a year) and Young was a former Conservative minister and confidant of Margaret Thatcher. Even though Levy was a Labour supporter, it is stated that he put aside their 'political differences' and within two years Levy became chairman of Jewish Care. Levy has raised as much as £60 million.

Although a multi-millionaire, Levy only paid £5,000 in tax in 1998-9 and less than £10,000 in 1997-8 as he said he wasn't working. He runs a private company called Wireart, an investment company which was based in an oversea tax haven until 1997. Wireart paid him £160,000 (plus £50,000 expenses) for work as a management consultant in 1998-9 at the time he wasn't working. Levy claimed that he was living off his savings and that the £160,000 was the part repayment of a loan, however this story changed when an aide divulged that he had worked as a management consultant. His expenses also included £31,000 in mileage, 'which equates to travelling up to 85,000 miles in the year, the equivalent of driving from London to Bristol and back every day.' Levy tried to obtain a 'gagging order' to stop his tax affairs from coming to light. This failed when the High Court ruled in favour of the Sunday Times. Levy's tax bill for the 1998/99 financial year saw him paying the Inland Revenue the same as someone earning the national average salary of Pounds 21,000.

Israel Connection

Besides the Chase House, Levy's £1.3m home in Totteridge (north London), He also owns a villa in Herzliya Pituah, an exclusive suburb of Tel Aviv in Israel, which he bought after selling another villa nearby for £4 million. He has acted as a fundraiser for Ehud Barak, the Israeli Prime Minister, and maintains a close relationship with him. His son Daniel Levy worked for the Israeli Justice Minister Yossi Beilin, to whom Levy contributed campaign funds. Both his children have lived in Israel, though Daniel later moved to Washington and is affiliated with The Century Foundation, the New America Foundation and anti AIPAC lobby group J Street.

In a speech by Jack Straw at the Labour Friends of Israel Annual Lunch in 2002, Straw thanked Levy for his work on behalf of the Jewish community in Britain. No details of Levy's involvement were given. The event was sponsored by Isaac Kaye and David Garrard with Israeli Ambassador, Zvi Shtauber in attendence.

Wielding great influence on British Jewry

In 2008, The Jewish Chronicle declared 'the top spots' on their second annual list of those who 'wield the greatest influence on British Jewry'. Levy is listed at number 9. The criteria for being listed is described as 'those with a vision for Jewish life in this country and who did their utmost to bring it about using either money; persuasion; religion; culture; political or social leadership; or simply inspiring through word and deed'. In order for someone to be listed in the top 20, it was generally necessary to demonstrate influence in more than one of the spheres.

Others included in the list were Trevor Chinn (number 14), Ron Prosor (number 10), Daniel Finkelstein (number 11), John Mann (number 17), Jonathan Freedland (number 18), Julia Neuberger (number 19), Lord Janner (number 20), Prime Minister Gordon Brown (number 29) & Poju Zabludowicz (number 30).

Levy and Blair

In 1994, the then shadow Home Secretary Tony Blair, and his wife, went on a trip to Israel at the Israeli government's expense. Two months after returning, Blair was introduced to former pop promoter, Michael Abraham Levy at a dinner party by Gideon Meir, the number two in the Israeli embassy in London. A month later the leader of the Labour Party, John Smith, died, and Blair won the leadership election contest with Gordon Brown - in some accounts with financial assistance from Levy who then set about raising money - the figure of £7 million is widely quoted - for the personal use of his new 'friend', Tony Blair, leader of the Labour Party.

The big early contributors to the 'blind trust' which funded Blair's office were:

'a group of businessmen involved in Jewish charities whose decisions to give to Labour have been crucially influenced by the party's strong pro-Israeli stance under both Tony Blair and his predecessor John Smith... Levy brought the world of North London Jewish business into the Labour Party... some of the names whom Levy persuaded to donate include Sir Emmanuel Kaye of Kaye Enterprises, Sir Trevor Chinn of Lex Garages, Maurice Hatter of IMO Precision Control and David Goldman of the Sage software group... it is clear, however, that for this group Blair's (and Smith's before him) strong support for Israel is an important factor, especially with those such as Kaye, Chinn and Levy himself, who raise large sums for Israeli causes. Nick Cosgrave, director of Labour Friends of Israel, says Blair "brought back Labour Friends of Israel into the Labour Party, in a sense ... before the majority of supporters of Labour Friends felt uncomfortable with the Labour Party.'

The Levy money enabled Blair to begin expanding his private office (he hired Alastair Campbell as his press officer in 1994 and diplomat Jonathan Powell as his chief of staff in early 1995), creating the biggest opposition leader's office in history, employing some 20 full-time staff on appreciable salaries.

It is reported that Levy was also connected to Blair as his 'personal Middle East envoy'

Labour fundraiser

According to Andrew Porter of The Business, Levy's expressed willingness 'to raise large sums of money for the party' also led to a 'tacit understanding that Labour would never again, while Blair was leader, be anti-Israel'. The partnership proceeded with Levy starting to invite potential donors for tennis at his palatial home where Tony Blair would join them for a set or two. Levy would then proceed to ask the guests for donations after Blair had left. Levy's fundraising strategy ensured that most of Labour's election funds came from private sources, rather than its traditional source - the trade unions, thereby weakening their say over policy and distancing the leader from a party he already held in low regard.

Levy was in charge of donations to the 'private trust' which funded Tony Blair's office before the 1997 election (which reached £7 million), and is now the chief fundraiser for the 'high value' donors account at the Labour Party, along with his deputy Amanda Delew (who worked with him at Jewish Care). He is reported to have raised £12 million for the 'high value' fund before the 1997 election, becoming known as 'Mr Cashpoint'. Straight after the election he was given a peerage. He used to work with Dr Henry Drucker, whose company Oxford Philanthropic was brought in by the Labour Party to advise on gaining large corporate donations, but they fell out over Drucker's description of Labour's 'blind trust' funds as 'evil' (the trusts have since all been closed down).

But the 'blind trusts' which were used as a vehicle to collect the money eventually caused public disquiet and such arrangements are now banned under the Political Parties, Elections and Referendums Act 2000. Similarly the search for high value donors has caused problems: it was Lord Levy who secured the £1m donation to Labour from Formula One millionaire Bernie Ecclestone which was repaid by the party to avoid accusations that it had been used to buy policies. Levy also brokered the deal in which the Hinduja brothers gave £1 million to the Millennium Dome.

The Observer asserted that the "PM 'personally helped' win the £1m Hinduja gift" and that the "donation was suggested over tennis with Tony" rather than after he left. The media eventually coupled the largesse of the Hindujas with their request for UK nationality. The results of the official investigation by Sir Anthony Hammond into the "passports for cash" scandal led to the resignation of then Northern Ireland Secretary Peter Mandelson (below) with whom Levy had worked closely concerning sponsorship of the Dome.

Despite training as an accountant Levy was caught up in more direct allegations of 'sleaze' when The Sunday Times published details of his tax return for 1998-1999 after he failed to get a publication ban in place through the courts. This revealed that he only paid £5,000 in tax - equivalent to that paid on a salary of £21,000.

There are further allegations that Frank Lowy, an Australian shopping centre magnate, made multiple payments worth $600,000 to Levy.

Levy is reported to be “upset and angry with Tony” after Blair went to Ronald Cohen for help in fundraising before the 2005 election.

Special Envoy

With Blair's accession to power Levy was ennobled and subsequently retained as a 'special envoy' to the Middle-East, leading predictably to the retention of a strong pro-Israel line. It was reported in the Sunday Telegraph 25 July 1999 that Blair tried to make Levy a Minister in the Foreign and Commonwealth Office (FCO). This would have been a stunning coup for the Israelis but it was resisted by the Foreign Secretary. Nevertheless Lord Levy's diary reveals a very high level of contact and involvement in the diplomatic process: including meetings with all the principle players in middle-east politics. Commentators point out that there is nothing in Levy's CV (dedicated to promoting the likes of Alvin Stardust, Bad Manners and The Darts) that particularly qualifies him for the role. As the Sunday Times reports, this positions 'is extraordinary for a man who is neither elected, nor publicly accountable, nor even a civil servant.'

Given the fact that Levy has both a business and a house in Israel and his son Daniel used to work for Yossi Beilin - the former Justice Minister of Israel - speaks of a serious conflict of interest, especially when he is the man assigned by Blair to negotiate impartially with Palestinians and Israeli's. The fact that Levy acted as a fundraiser for former Israeli Prime Minister Ehud Barak casts further doubt on his capacity for impartiality.

His role as unofficial envoy for the Middle East took him to 8 different countries in 1999, staying in British Embassies, including Syria, Jordan, Oman, Qatar, Israel, Egypt and Lebanon (where he was accused by the Lebanese Government of bringing them the Israeli position and the British Ambassador had to issue a statement to try and calm the situation down). He was also provided with cars, drivers and staff support. The Embassy in Amman, Jordan, arranged a lunch for him to meet Jordanian politicians.

The Centre and the Network

Levy also joined the advisory board of Blair's Foreign Policy Centre which organises events such as their March 2nd 2006: Challenges and Opportunities in Israel, Gaza and the Middle East. This will take the format of a lecture by Eival Gilady, formerly Head of Co-ordination and Strategy at the Office of the Israeli Prime Minister and who also served as a Brigadier General and Head of the Israel Defence Force's Strategic Planning Division. Gilady, has had a 'distinguished' military career spanning three decades - commanding field units for twenty years, and serving an additional ten years at the General Staff.

Levy is also on the board of (and the FPC shared its offices with) Peter Mandelson's think tank the Policy Network. The Policy Network was set up when Mandelson resigned after the Hinduja affair. A source close to the think tank claimed it "was all part of attempts by Downing Street and friends to 'feather bed' his second fall from grace". Sir Evelyn de Rothschild funds the charity, the Policy Network Foundation which funds the Policy Network.

Mandelson said he would be using the Network's high profile platform to launch an attack on the policies of the anti-globalisation protesters. 'The social movement opposed to globalisation is heading up a whole number of cul de sacs,' he said. 'Nevertheless those of us on the Centre Left need to rise to a higher level of engagement. We cannot reduce important debate about serious matters to an issue of crowd control.' And this has also been a focus of the FPC and Demos in the work of John Lloyd.

The Policy Network, recently moved from its Mezzanine office to 11 Tufton Street, home of the Social Market Foundation and where the Adam Smith Institute hold their meetings.

Other links

Levy is also a key member of the Labour Friends of Israel, former chairman of the Jewish Care Community Foundation, a member of the Jewish Agency World Board of Governors, and a trustee of the Holocaust Educational Trust; a member of the International Board of Governors of the Peres Center for Peace; a member of the World Commission on Israel Diaspora relations and President of Community Service Volunteers and Jewish Care (where he also engages in fundraising).

• United Jewish Israel Appeal, Honorary President

Community Service Volunteers (CSV)

In 2003, Levy is reported to be the president for the charity Community Service Volunteers (CSV). The Sunday Times reports on a 'charity fundraiser' for the CSV were 'the invited list of dignitaries revealed how Levy has been introducing wealthy individuals who have also helped Labour'. David Blunkett was in attendance along with Christopher Ondaatje, John Reid (Elton John's former manager) and Derek Tullett, who had all given generously to New Labour. It is reported that Ondaatje has given £2million to Labour (He also received a knighthood), and Tullett gave more than £300,000. In 2003, 12 of the 16 named "patrons" of CSV are reported to be 'big Labour donors'. One of the patrons, David Garrard, who is chairman of the property group Minerva (and who is also on the Board of the Princes Trust) became a patron 'just weeks before he was given his knighthood in the new year's honours list for charitable work'. It is reported that he then gave £200,000 to Labour a few months later.

This event was, as one MP is reported to have noted, 'the "champagne socialist jet set" in action'. Levy is reportedly known as "Mr Cashpoint", and it is claimed that he 'had already managed to obtain more than £3m for Labour from those invited that night'. The Sunday Times states that 'anyone looking at those invited -who included Chris Smith, the former heritage secretary -might be forgiven for thinking that this was a Labour event. It was not. It was an event for the Community Service Volunteers (CSV) charity'. The report continues, 'among them are businessmen whose firms have won government contracts worth millions of pounds, and quangocrats who sit on committees and taskforces helping to shape the industries in which their money is made'. Whilst 'In the past year alone, four of the patrons who are Labour donors have been honoured with three knighthoods and an OBE'. The Sunday Times claims to have 'learnt that Levy indicated to one businessman who was considering giving a substantial sum to Labour -that CSV might recommend him for an honour if he also pledged a substantial sum to the charity'. This was later described as an 'absolutely rubbish' allegation by Levy's spokesperson in a statement which stated that Levy 'has never said anything of this kind to anyone involved in donations to charity' and 'Lord Levy does not know anyone who has received an honour for simply donating to CSV. Honours are not in Lord Levy's gift'.

As president of the CSV, according to the Sunday Times, Levy has effectively 'formed an elite group where those seeking influence could meet each other and leading politicians at functions' with the stated purpose being to raise money for charity. It is claimed that, 'Entry into this "club" could be achieved by giving a minimum of £10,000 to charity'.

Labour donor and CSV patron Sir Kumar Bhattacharyya, is reported to have been 'regularly consulted by Blair' and he also 'serves on several quangos'. According to the Sunday Times, 'the government has provided nearly Pounds 40m for a research centre run by Bhattacharyya's Warwick Manufacturing Group'.

Chai Patel 'is another patron and Labour donor with a network of connections'. Chai was awarded a CBE in 1999, was former adviser to the government about the elderly and has sat on a number of taskforces. He is also Chief Executive for the Priory Group (a mental health services provider that gets around £60m a year from the NHS) and is non-executive chairman of Ukprocure ('which has benefited from a government drive to encourage NHS to buy goods online').

'Refrigerator millionaire' William Haughey is also a patron who is also described as 'one of the Scottish Labour party's biggest donors'. Haughey is a major shareholder in Celtic Football Club and has also been awarded an OBE.

The Sunday Times concludes with a note that not all the patrons have received recognition, such as Isaac Kaye.

Levy joined CSV in 1998 after being introduced by Lord Brooke of Alverthorpe, a Labour peer who was a trustee of the charity. Cherie Blair has also been involved by being called upon to launch a patron scheme for the charity in June 2001 which was held at Downing Street.

References, Resources and Contact

Resources

• A chapter from Dave Osler's recently published book Labour Party plc: New Labour as a Party of Business which focuses on Levy. [1]
• BBC Breakfast with Frost interview Lord Levy, 9 July, 2000. [2]
• A collection of sleaze related links. [3]
• Euan Ferguson, There was once a jolly bagman, The Observer, 19 March, 2006.