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Lord Peter Mandelson was passing on confidential information from the highest levels of the UK government to Jeffrey Epstein, who had previously paid him $75,000, while he was a cabinet minister, according to newly released documents.
The Labour minister leaked plans for a €500bn bailout of the euro to the American paedophile financier as well as a private Downing Street document discussing the government’s financial plans while he was both business secretary and de facto deputy prime minister in 2009 and 2010.
Epstein asked Mandelson if it was true that a €500bn bailout of the euro was “almost complete” on Sunday, May 9, 2010. Mandelson replied within minutes, saying: “Sd be announced tonight.”
The next morning European governments approved a deal after 11 hours of talks to stop the single currency collapsing amid fears of default in the wake of the financial crisis.
Mandelson leaked a high-level Downing Street document to Epstein that proposed £20bn of asset sales and revealed Labour’s tax policy plans. The memo, dubbed “Business issues”, was written on June 13 2009 by Nick Butler, who at the time was special adviser to prime minister Gordon Brown.
The confidential “Business issues” document, released by the US Department of Justice as part of a tranche of millions of files relating to Epstein, had been sent to British government officials including cabinet secretary Jeremy Heywood.
The memo called for a boost to private-sector investment in the wake of the 2008 financial crash via tax incentives.
“The only major device available to government is a further extension of the capital allowances announced in the Budget,” Butler wrote. “We should consider raising the capital allowance on new investment to 75 per cent (or even more) for the remainder of this tax year.”
He also said Brown should authorise asset sales “of even £20bn” to relieve the debt burden, reduce borrowing costs and provide funds for new investment.
“It would also enable us to go into the election with a pledge not to make any further increase in corporate or top rate income taxes in the next parliament,” Butler wrote.
The highly sensitive document was forwarded by Mandelson to Epstein on the same day with the comment: “Interesting note that’s gone to the PM.”
Epstein replied: “What salable assets?” “Land, property I guess,” Mandelson responded.
The Labour government announced the plans for the asset sale four months later, suggesting that £16bn could be raised through the disposals. Mandelson was approached for comment on Monday.
Separately, a confidential memo was forwarded to Epstein in August 2009; the name of the sender was redacted.
Shriti Vadera, financial adviser to Brown, wrote an email with proposals to try to get banks to lend more in the wake of the financial crisis. She sent it to Mandelson, principal private secretary Jeremy Heywood and “John Pond”, a pseudonym for Brown.
Heywood replied, suggesting that the Bank of England and Treasury should be doing more to encourage non-bank lending, and that the Bank should do more “credit easing in the Fed sense”. Just seconds later the unidentified person forwarded the chain to Epstein.
One person close to Mandelson said on Monday that he had been “not part of these discussions and unaware of their contents”.
The tranche of emails also showed Mandelson and Epstein discussing who would be the next chair of British bank Barclays.
Epstein asked Mandelson on August 3, 2012 if he had “any inside on who the next chairmna [sic] of barclays will be”.
Mandelson replied, “We will need to speak on the phone.” A day later Mandelson asked Epstein, “Does your boy know Sir David Walker”. Barclays announced the appointment of Sir David Walker on August 9, 2012.
The revelations will add to escalating pressure on Mandelson, who resigned from the Labour Party on Sunday. Documents released at the weekend showed that he received three payments of $25,000 each from Epstein when he was a backbench MP in 2003 and 2004.
His partner Reinaldo Avila da Silva also received thousands of pounds from Epstein in 2009 and 2010 when Mandelson was business secretary, the files showed.
Nick Macpherson, who was Treasury permanent secretary in 2009, said: “[Then chancellor] Alistair Darling and the official Treasury were always aware that investment banks had an inside track to Number 10. But the brazen nature of that inside track is rather breathtaking.”
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