A £10,000 gift to Richmond's Conservatives by a casino operator posed a conflict of interest when it came to determining council policy, according to the council’s deputy leader.

Figures from the Electoral Commission reveal Knightsbridge casino Aspinalls – where Tory parliamentary candidate Zac Goldsmith is a familiar face – made the donation to Richmond Park Conservative Association.

The Lib Dems argue the gift means Conservative councillors should have declared a conflict of interest when Richmond Council’s policy on casinos was discussed at a meeting on December 2.

However, the Conservatives say they took official advice and were informed no conflict arose. They accused the Lib Dems of using smear tactics.

Zac Goldsmith told the Richmond and Twickenham Times Aspinalls benefited nature conservation, and he was proud to be a trustee of the club’s wildlife charity.

The row blew up after Lib Dems spotted Aspinalls, in Sloane Street, had given £10,000 to Richmond Park Conservatives on July 1.

Councillor Stephen Knight, Richmond Council deputy leader, said: “It is unacceptable Conservative councillors failed to declare they had accepted a large cash donation from a casino operator just months before voting on casino policy for the borough.

“This breeds suspicion of sleaze among the public and brings councillors into disrepute.”

The rebuke brought a swift response from Councillor Nick True, leader of Richmond Conservatives. He said that Coun Knight’s “oily smears” typified the negative campaigning which voters now expected from the Lib Dems.

He said Coun Knight had to “apologise to the council for not declaring an interest in Teddington School where he incompetently let costs overrun by £9m to the detriment of the taxpayer” and called for an end to “self-interested and divisive clique of party-first politicians”.

He said: “We want no such casinos, and we have no interest to declare in any casino.” He added the council chief executive had said the party had no interest to declare.

Mr Goldsmith confirmed he was a trustee of the Aspinall Foundation, and was “a huge fan of its work”.

He added: “The Aspinall Foundation is responsible for some of the world’s most exciting conservation projects.”

He condemned the Lib Dems’ “attack team”, and added: “Aspinalls club has no commercial interests in Richmond, and has no plans to develop any such interests. The same cannot be said of Tesco, which has made generous contributions to the Lib Dem Party, and whose campaign to take over our shopping areas is truly alarming.”