Scottish Labour has today called for an urgent investigation after an SNP candidate has been forced to hand back £128,000 of public money awarded to an organisation he runs.

The SNP controversially awarded money to the Scottish Islamic Foundation headed by Osama Saeed – a former employee of Alex Salmond, and the SNP candidate for Glasgow Central.

Of the £400,000 of public money awarded to the Scottish Islamic Foundation, £128,000 has had to be returned because of irregularities surrounding what the money has been spent on.

The Scottish Islamic Foundation, headed by SNP candidate Osama Saeed, was founded just last year and was immediately awarded the money to organise IslamFest. The event has never taken place and it is unclear how the money has been spent, even though the organisation was specifically set up to receive the public money. The majority of board members are SNP researchers or activists.

Following queries from the press, the Scottish Government announced this weekend that the money from the organisation would have to be returned.

Labour MSP for Glasgow Shettleston, Frank McAveety MSP, said:

"This is an extraordinary development and one which is personally embarrassing for the First Minister.

"There are too many unanswered questions about why an organisation no-one had ever heard of received lavish funding at the expense of long-standing and respected Muslim organisations in Scotland.

"When the award was made, it raised eyebrows. This front-group was set up with the sole purpose of receiving taxpayer's money from the SNP.

"Now the full extent of the links between the SNP and this organisation are exposed.

"People are suspicious that the SNP have tried to fund an election candidate with public money.

"I believe that the proper rules were not followed when this money was awarded and that the Scottish Parliament should investigate the irregularities and determine why the SNP tried to do political favours for its preferred candidates.

"I have today written to the Chair of the Local Government and Communities Committee to ask him and his colleagues to investigate the irregularities in awarding this money.

"I have also written to Alex Neil, the SNP Communities Minister, asking him to clarify matters urgently."

15 August 2009