The British government refused to assist a French investigation into suspected money laundering and tax fraud by the UK telecoms giant Lycamobile – citing the fact that the company is the “biggest corporate donor to the Conservative party” and gives money to a trust founded by Prince Charles.

French prosecutors launched a major probe into the firm and arrested 19 people accused of using its accounts to launder money from organised criminal networks two years ago, after BuzzFeed News revealed its suspicious financial activities in the UK. But the Conservatives continued taking Lycamobile’s money – and it can now be revealed that the British authorities stonewalled a formal request from French prosecutors to carry out raids in London as part of the ongoing investigation.

Confidential correspondence between British government officials and their French counterparts, shown to BuzzFeed News by a source in the UK, reveals that the French wanted British authorities to raid Lycamobile’s London headquarters last year and seize evidence as part of their investigation into money laundering and tax fraud by the company.

In an official response dated 30 March 2017, a government official noted that Lycamobile is “a large multinational company” with “vast assets at their disposal” and would be “extremely unlikely to agree to having their premises searched”.

The letter, from the team at HMRC that handles law enforcement requests from foreign governments, continued: “It is of note that they are the biggest corporate donor to the Conservative party led by Prime Minister Theresa May and donated 1.25m Euros to the Prince Charles Trust in 2012.” The email referred to Lycamobile's donations to the British Asian Trust, which was founded by the Prince of Wales to tackle poverty in South Asia, not to his youth foundation The Prince's Trust which has never received any money from Lycamobile.

The HMRC response went on to say that Lycamobile would be likely to challenge any raids on its properties in court and may succeed because the French request did not contain enough “solid information”. The request stalled, and Lycamobile’s UK offices were never searched.

But the French investigation has continued to gather steam. Lycamobile has been ordered to pay €20 million bail after its two French companies were formally charged with money laundering in a Paris court in November and January.

When BuzzFeed News first approached HMRC to ask about its response to the French request, the agency’s senior press officer strongly denied that Lycamobile’s donations would ever be cited as a reason not to conduct criminal raids. “No HMRC official would ever write such a letter,” he said. “This is the United Kingdom for God’s sake, not some third world banana republic where the organs of state are in hock to some sort of kleptocracy.”

However, after verifying the contents of the email seen by BuzzFeed News, another HMRC spokesman said that it was “regrettable”.

“We never take political donations into account when working out how to work with other countries, or indeed on our own, in enforcing the tax law,” he said, adding that the reference to Lycamobile’s links to the Tories and Prince Charles had been included only as “background” information. “But I can see how this is open to being read that way, which is why that should not be in there,” he said.