Fraud probe into £112m Unite hotel complex

The Unite trade union has told Sky News the Serious Fraud Office (SFO) is to investigate a controversial hotel and conference centre in Birmingham that cost the union almost £112m.

The union, formerly Labour's biggest donor, says it believes there was "serious financial wrongdoing" when it was run by Jeremy Corbyn cheerleader Len McCluskey and his allies.

The hotel project, undertaken when Mr McCluskey was general secretary from 2011 until 2021, also included new union offices and was intended to save money on hotel rooms and conference bills.

But after it was initially estimated to cost £7m, the building costs ballooned to £57m before construction even began. Completed in 2020, the total cost was £112m, Unite has told Sky News.

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After Unite's current general secretary Sharon Graham succeeded Mr McCluskey in 2021, she launched an inquiry into the project, led by top barrister and deputy high court judge Martin Bowdery KC.

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And after having the hotel - which has 195 bedrooms and a conference centre for 1,000 people - valued at just £29m by "forensic accountants", she also pledged to recover any money owed to the union.

Announcing the SFO's involvement, a Unite spokesman told Sky News: "Sharon Graham has been subject to three years of sickening and horrendous attacks since she commissioned independent KC-led inquiries into the Birmingham hotel project and further inquiries into the union's affiliated services."

The spokesman added that "these inquiries have shown what we believe to be serious financial wrongdoing during the previous regime led by Len McCluskey".

He continued: "The KC-led inquiry into the costs of the Birmingham hotel has been handed to the Serious Fraud Office and independent forensic reports into the union's affiliated services, while overseen by Howard Beckett, are currently part of an investigation by South Wales Police.

"We are limited in what we can say at the moment due to the police investigations, but will be issuing an interim report into the findings of the reports.

"Ms Graham has kept her promise to 'leave no stone unturned' in uncovering any wrongdoing that took place prior to her election.

"Unite is currently pursuing legal claims to recover money lost to the union and the general secretary has put safeguards in place to ensure that such things can never happen again."

An SFO spokesperson told Sky News: "In line with long established practice to avoid prejudice to law enforcement activity, we can neither confirm nor deny any investigation into this matter."

Mr McCluskey has been contacted for comment.