THE FALLOUT from the 'cash for honours' saga was edging closer to Tony Blair's inner circle last night with some of his closest allies facing charges following the lengthy police investigation into claims that peerages were offered in return for huge donations to the Labour party.
A 216-page file passed to prosecutors by Scotland Yard on Friday is believed to have presented evidence to support charges against three significant figures in the investigation.
Blair's fundraiser, Lord Levy, his 'gatekeeper' Ruth Turner, and bi
g-ticket Labour donor Chris Evans are believed to be facing the prospect of prosecution on suspicion of involvement in the "sale" of honours, or conspiracy to pervert the course of justice.
The looming charges, which follow a year-long investigation, were revealed by Scotland on Sunday two months ago.
But speculation was mounting last night that the police's attention had moved beyond the three figures most closely linked with their investigation - and could take in two more of Blair's backroom team.
One government source last night said the Prime Minister's political secretary, John McTernan, and chief of staff Jonathan Powell may also have been mentioned in the report to the Crown Prosecution Service (CPS). All five deny any wrongdoing.
A CPS spokesman last night insisted that prosecutors would make the final decisions on any prosecutions arising from the investigation.
But it is believed that Assistant Commissioner John Yates, who headed the inquiry, has presented the CPS with evidence of "serious wrongdoing".
The 13-month probe had widened in recent months to look into any attempt to pervert the course of justice. Scotland Yard said that 136 people had been interviewed. A spokesman said there had been extensive consultation with the CPS during the inquiry, and this was the 12th police submission. In total, Scotland Yard has handed over 6,300 documents.
The police inquiry began after it emerged that secret loans had been made to Labour before the 2005 general election, and that some lenders had subsequently been nominated for peerages. The probe was extended to include the other main parties.
Four people have been questioned under caution during the course of the inquiry, including Levy, Turner and Evans, a wealthy biotech entrepreneur. The first man arrested, head teacher Des Smith, has already been told he will not face any charges. The others remain on police bail.
Opposition parties have raised concerns that the final decision on whether to proceed with any prosecutions will be made by Attorney General Lord Goldsmith, a Blair appointee who sits in the Cabinet.
Sources in the Attorney General's office have warned against expecting any quick developments in the case, saying it was "early days" for the Crown lawyers.
In a statement, the CPS said it had received the file and that the police would be told of the decision "in due course".
A spokesman added: "We wish to make it plain once again that it is not the role of any agency to recommend charges to the CPS.
"Any decision on charges will be taken by the CPS alone after full and careful consideration of the evidence."
SNP MP Angus MacNeil, who sparked the investigation with a complaint to Scotland Yard, said the submission of the report was "an enormously significant development".
"The police are to be congratulated for resisting political pressure and conducting such a thorough inquiry at every stage," he added.
