Definition of slush fund

A slush fund can be any sum of money gathered and set aside as a reserve. For example a sporting club might raise money from its members to pay for fixtures throughout the year and any money left over in the slush fund might be put towards an annual social event.

In politics or in the corporate world the term slush fund is often used to describe money raised from a secret or illegitimate source and/or used for fraudulent or unpopular purposes. For example, a company might be said to be treating its pension fund as a slush fund if it raids it to repay its own debts or even to pay for assets that will not be owned by the pension fund.

 

slush fund in the news

In July 2013, Spain's ruling Popular party faced accusations that it funded itself through secret and illegal donations from construction groups and other companies and used part of that money to set up a slush fund. The bulk of that fund was then allegedly used to make cash payments – in envelopes – to senior party leaders.

In December 2012, the UK Serious Fraud Office was accused of operating a "slush fund" as a second secret payment to an outgoing executive was revealed. It transpired that the SFO was planning to pay as much as £475,000 to its chief operating officers Chris Bailes, when he stepped down at the end of the year. Labour's shadow attorney general said: "The attorney general can't have been providing much oversight at teh SFO if it was being used as a slush fund under his very nose."

FT Articles & Analysis

Related Terms