UK tightens overseas political donation rules to curb foreign interference, as Farage faces a watchdog probe over an undeclared crypto donation.

Britain tightened its rules on overseas political donations on Monday, as part of efforts to stop foreign money influencing elections, and as concerns swirl around what Housing Minister Steve Reed called “dodgy funding”. 

Last year, the government ordered a review into foreign financial interference in politics after a former politician in Reform UK was jailed for taking bribes to make pro-Russia speeches and statements.

The review found Britain faced a persistent problem of foreign countries, including Russia, China and Iran, trying to influence and undermine the country’s democracy, prompting the government to introduce the new rules. 

They come as the leader of the anti-immigration Reform UK party, Nigel Farage, is under investigation by the parliamentary standards watchdog over whether he should have declared a £5 million ($6.68 million) donation from a Thailand-based cryptocurrency billionaire, which was given before Farage said he would stand as a member of parliament. 

Britain’s Ministry of Housing, Communities & Local Government said on Monday that from now on political candidates would be required to declare donations of over £2,230 received prior to becoming a candidate and prove any pre-candidacy funding had come from legitimate sources. 

“By holding overseas donors to tougher standards and requiring candidates to prove where their funding comes from, we are taking world-leading action to protect the integrity of our elections and tackle the threats we face from abroad,” Reed said in a statement. 

The tougher rules also mean individuals moving to the UK from overseas now have to live permanently in the UK for a year before they can make a political donation of £100,000 or more, while donations from companies are to be assessed against past post-tax profits rather than revenue, helping to ensure only legitimate UK-linked businesses can donate.

These rules build on those announced in March, which capped donations by Britons living abroad at £100,000 per year, and introduced a ban on crypto donations until a system to regulate them effectively is established. 

Farage’s Reform UK, which has topped national opinion polls for over a year, has said no rules were broken over the donation to Farage from crypto investor Christopher Harborne, who provided about two-thirds of Reform’s funding last year, according to Electoral Commission data.

On Sunday, Farage was referred to parliament’s standards watchdog after a report that he failed to declare some other benefits.