A billionaire businessman caught up in the Victorian Liberals donor scandal paid a quarter of a million dollars to a fringe political party that folded before the state election.
The Victorians Party received $250,000 from racing identity Jonathan Munz's business GSA Capital for an annual membership subscription, according to its register of interests.
Donations to Victorian political parties are capped at $4320 over each four-year term and cannot be made anonymously if $1080 or above.
But annual subscription fees for memberships fall outside the strict donation laws, although the funds can only be used for administrative costs.
In a statement, the Victorian Electoral Commission confirmed membership fees, annual affiliation fees and annual levies are not considered to be political donations as long as they are not paid into the recipient's state campaign account.
The Electoral Act does not specify a limit in relation to these fees.
The commission warned that knowingly making or accepting an unlawful political donation, or providing false or misleading information, could result in a fine of more than $50,000 as well as a two-year prison sentence.
Attempting to circumvent the Electoral Act via a "scheme" could also result in 10 years in prison.
The Victorian branch of the Australian Labor Party and Victorian Liberals charge annual subscription fees for their memberships, ranging in price from $30 to $400.
A spokesman for the Victorians Party said the $250,000 payment was permitted under state electoral laws and used for the set up and administration of the new party rather than campaigning.
"The payment was disclosed by the Victorians Party as required under the Electoral Act," he said in a statement.
"The Victorian Labor Party received similar membership payments from its affiliated unions, but for many millions of dollars, raising close to $1.8 million in 2021-22.
"This is standard and accepted practice."
The Victorians Party ran on a platform of integrity, honesty and competence and was born out of frustration with lockdowns and Premier Daniel Andrews.
It was voluntarily deregistered in September after vowing to contest all 88 seats and eight upper house regions.
At the time, a party spokesman attributed its sudden exit to funding constraints brought on by the state's donations laws.
Mr Munz, who is listed as GSA Capital's owner and chairman, was in 2021 asked by then-opposition leader Matthew Guy's chief of staff Mitch Catlin to make more than $100,000 in payments to his private business.
Mr Catlin resigned following the revelation and Mr Munz denied making any payment to him, describing the email as unsolicited and unwanted.
The electoral commission launched an investigation into the scandal but later referred the matter on to the corruption watchdog, accusing Mr Guy and the Liberals of failing to fully co-operate.
