Why is the SNP under investigation over its party finances?

Police Scotland’s investigation into alleged financial irregularities within the Scottish National Party (SNP), known as Operation Branchform, has taken a further twist after Nicola Sturgeon was arrested.

Police Scotland said the former SNP leader, who quit in February, was held custody and questioned by detectives before being released without charge on Sunday (June 11).

A spokesperson for Ms Sturgeon said she attended an interview “by arrangement with Police Scotland, where she was to be arrested and questioned in relation to Operation Branchform”.

“Nicola has consistently said she would cooperate with the investigation if asked and continues to do so,” the spokesperson said.

The former first minister’s arrest comes after her husband Peter Murrell, the former SNP chief executive, was arrested in April, just weeks after he had resigned his post.

He was released without charge pending further enquiries as police searched several properties and seized a luxury mobile home from the driveway of Mr Murrell’s 92-year-old mother in Fife.

MSP Colin Beattie was later arrested while in the role of party treasurer but released without charge pending further enquiry. He stepped down from his role.

It had been widely expected that Ms Sturgeon, who continues to be the MSP for Glasgow Southside, would be quizzed by police as part of the probe. She has also pledged to “fully cooperate” with the investigation.

But the affair still represents an ignominious fall from grace for Scotland’s first female and longest-serving first minister just months after she announced her resignation, with Humza Yousaf since elected to succeed her.

The party in power in Scotland now appears to be haemorrhaging support as Mr Yousaf tries desperately to steady the ship, taking charge of the SNP’s finances himself since Mr Beattie’s resignation and reassuring his supporters the party does not face bankruptcy.

“We’re definitely not facing bankruptcy, I’m pleased to say we are on a steady footing when it comes to the party’s finances,” he said,

“I don’t think parliament is the place to do a statement on the party’s finances... I’ve, of course, instructed the governance and transparency review, and when the report comes in on that review, I’ll make that public.”

Here, we look back at the origins of the inquiry.

Police Scotland first launched its investigation into potential criminality within the SNP’s fundraising in July 2021 after a formal complaint was filed in March that year by party activist Sean Clerkin, who alleged that around £666,953 in donations raised since 2017 for a second independence referendum campaign had been spent on other things, contrary to promises made to supporters.

In the months preceding the announcement of the probe, several senior figures – including SNP treasurer Douglas Chapman and MSP Joanna Cherry – quit the party’s national executive committee (NEC).

Mr Chapman had complained that a lack of transparency about the finances had prevented him from carrying out his “fiduciary duties”.

Asked about the affair by STV in June 2021, Ms Sturgeon said: “I’m not concerned about the party’s finances. The finances of the SNP are independently audited... so there’s full scrutiny around that.

“Money hasn’t gone missing... We don’t hold separate accounts, we’re under no legal requirement to do that, our accounts are managed on a cash flow basis.”

By May 2022, the inquiry had been given the codename Operation Branchform but frustration over the apparent slow pace of its progress began to be expressed, with Mr Clerkin calling on police to “step up” their efforts.

The following December, it emerged that Mr Murrell had given a personal loan of £107,620 to the SNP in June 2021, which was paid to help out the party with a “cash flow” issue after the last Holyrood election, the SNP said.

No interest was being charged by Mr Murrell and £47,620 had been repaid in two instalments in August and October of 2021, Electoral Commission records revealed.

Mr Yousaf has since confirmed that the party still owes the remainder of the loan, presumably around £60,000, to its former chief executive.

Mr Clerkin lodged a fresh complaint with Police Scotland in January 2023 after it emerged that the SNP’s leadership had still not been questioned 18 months on from the inquiry’s launch, prompting the force to ask the Crown Office, the Scottish prosecution service, for “advice and direction” in the case.

On 15 February, Ms Sturgeon unexpectedly announced her resignation as first minister and SNP leader after eight years in power.

In an emotional address from Bute House in Edinburgh, she spoke candidly about her time in office and the stresses of the job but declined to be drawn on the investigation when asked by one reporter, saying only, as she gathered her notes: “I’m not going to discuss an ongoing police investigation. I wouldn’t do it on any issue and I’m not going to do it now.”

Six weeks later, after the conclusion of the election race to find her successor ended with Mr Yousaf’s victory over Kate Forbes and Ash Regan, the investigation returned squarely to the spotlight with the arrest of Mr Murrell.

Officers also carried out searches at a number of addresses as part of the investigation, including the South Lanarkshire home of Ms Sturgeon and Mr Murrell and SNP headquarters in Edinburgh, culminating in the confiscation of the campervan, which insiders said had been bought by the SNP for use as a campaign “battle bus”.

Following Mr Murrell’s release, Mr Yousaf came under pressure to suspend his predecessor after Scotland’s Sunday Mail reported that detectives had been handed emails showing Ms Sturgeon quashed the idea of appointing a fundraising manager in June 2021, also publishing a video of her telling the NEC there were no problems with the SNP’s finances, dismissing concerns.

Mr Beattie was arrested and released in April and later resigned after the best part of two decades as party treasurer.

Ms Sturgeon was arrested on 11 June, as part of a pre-arranged interview with police, in what is unlikely to be the last development in the saga.