European Parliament senior leaders have ordered the Alliance of Conservatives and Reformists in Europe (ACRE) to repay €535,609 of EU funds.

The group is co-founded by the Tories and led by Brexit campaigner and MEP Daniel Hannan. As reported by the Guardian, an investigation of their spending found they hosted luxury events of little relevance to the EU.

ACRE will also be denied a further €187,245, which had been withheld pending investigation. A formal demand for repayment will be issued next week.

According to the Guardian, Hannan, who has championed Brexit for more than a quarter of a century and was ACRE’s secretary-general until December 2017, is told that there are grounds to suspect a conflict of interest on his part. This is based on leaked documents seen by the Guardian. Hannan called that conclusion “absurd” and accused investigators of making false insinuations that were “outrageous”.

The authorities suggest that the money has in some cases been used to promote events which are of limited relevance or benefit to the EU.

Among parliament’s objections was €250,000 spent on a three-day event at a luxury beach resort in Miami. While the keynote speaker was listed as former Spanish prime minister, José María Aznar, the conference had “an almost exclusively American audience”, the parliament found, with an agenda that hardly mentioned the EU.

It also questioned €90,000 spent on a trade “summit” at a five-star hotel on the shores of Lake Victoria in Kampala, where a largely British delegation met African delegates to discuss post-Brexit trade.

The “Great Lakes Trade summit” in Kampala brought together a mostly African audience to meet 20 British politicians and participants, with only three attendees from continental Europe.

ACRE insisted that both events “contributed to EU awareness and focused on topics clearly pertinent to EU integration and EU policies”.

In an article published on Conservative Home, Hannan said “the reason” he visited Kampala was “to promote closer commercial links between the region and a post-EU Britain”.

The Guardian also reported that ACRE officials said they were taking legal action at the European Court of Justice and Belgian courts.