The Metropolitan police have formally launched a criminal investigation into allegations that Peter Mandelson leaked Downing Street emails and market sensitive information to the child sex offender Jeffrey Epstein.
Documents from the Epstein files released in recent days appeared to show the then business secretary sent confidential details of internal discussions to the late financier in the aftermath of the financial crash.
The revelations have prompted a furious backlash from across the political spectrum, including Gordon Brown who was the prime minister at the time of the alleged breaches, and have once again thrown the spotlight on the decision to appoint Mandelson US ambassador.
Detectives are now expected to interview Mandelson and request access to his devices, as well as take witness statements from senior Labour party figures including Brown and senior civil servants from around the time the emails were sent.
They are also likely to ask the US administration to give them unredacted copies of the emails, amid concerns that Mandelson used a now defunct private BT internet email address to correspond with senior government figures.
Scotland Yard confirmed on Tuesday night that Mandelson was being investigated on suspicion of misconduct in public office, an offence that carries a maximum sentence of life imprisonment.
In a statement, the Met commander Ella Marriott said: “Following the further release of millions of court documents in relation to Jeffrey Epstein by the United States Department of Justice, the Met received a number of reports into alleged misconduct in public office, including a referral from the UK government.
“I can confirm that the Metropolitan police has now launched an investigation into a 72-year-old man, a former government minister, for misconduct in public office offences.
“The Met will continue to assess all relevant information brought to our attention as part of this investigation and won’t be commenting any further at this time.”
Mandelson has said he cannot recall receiving $75,000 from Epstein, which appears to be evident in bank statements in the document tranche, and has questioned the veracity of some of the documents.
As the scandal blew apart government plans to focus on domestic issues this week, the former business secretary resigned from the House of Lords on Tuesday afternoon.
Keir Starmer said Mandelson had “let his country down”, adding: “For the public to see politicians saying they can’t recall receiving significant sums of money or not was just gobsmacking, causing them to lose faith in all politicians and weaken trust still further.”
The prime minister, who has ordered a dossier to be handed to the police, told a cabinet meeting he was appalled by the reported leaks, and has asked officials to draft legislation to strip Mandelson of his peerage “as quickly as possible”.
Government insiders are concerned the prime minister could once again find himself in the line of fire for his decision to appoint Mandelson as the UK’s ambassador to Washington. His chief of staff, Morgan McSweeney, who was close to Mandelson, had been blamed by some MPs for pushing the idea.
Labour MPs said that No 10 had made calls over the course of the day to assess the vulnerability of Starmer’s position. “Morgan is completely exposed but I just don’t think Keir can function without him,” one backbencher said.
It is understood that the foreign affairs committee discussed whether McSweeney could be called to give evidence on Mandelson’s appointment, but no decision was made, and it is believed that as a special adviser he could refuse to appear.
Starmer’s spokesperson said the Cabinet Office was looking at all information it had about the documents, but an initial review of the Epstein files released on Friday found they contained information that was likely to be market sensitive about the 2008 financial crash and attempts to stabilise the economy afterwards.
One government official said that they believed the internal Whitehall investigation would need to rely on the police inquiry to get to the bottom of the scandal. “If you look at the ways the emails were forwarded, nothing short of a full search of his devices is going to find the answers.”
The UK health secretary, Wes Streeting, said Mandelson’s association with Epstein was a “betrayal on so many levels” but that he could not see how the Cabinet Office or Starmer would have known about the leaking of confidential information to Epstein.
Emails forwarded to Epstein from the top of the UK government showed Mandelson, who was business secretary from 2008 to 2010, claiming he was “trying hard” to change policy on bankers’ bonuses; sharing details of an imminent bailout package for the euro the day before it was announced; and suggesting that the JP Morgan boss “mildly threaten” the chancellor.
Several hours before Brown announced that he was standing down as prime minister, after the collapse of coalition talks and with Mandelson giving him counsel, the former politician emailed Epstein: “Finally got him to go today.”
The European Commission, where Mandelson was trade commissioner from 2004 to 2008 before leaving to return to UK politics, is also investigating the former politician, who draws a pension from his time there and has to adhere to a code of conduct for former staff.
The Lords Speaker announced Mandelson’s departure, meaning he will no longer be a member from Wednesday, though he will retain his title, which can be removed only by an act of parliament. No 10 had suggested it would update the process as part of broader reform of the House of Lords.
However, Starmer told ministers he found it incomprehensible that more could not be done to strip peers of their titles for poor behaviour. “The prime minister believes there is a broader need for the House of Lords to be able to remove transgressors more quickly,” his spokesperson said.
The Tories are said to be wary of a specific bill to strip Mandelson of his peerage – given the precedent it might set for a government with a large majority to go after individuals. Sources in the House of Lords said it was likely that peers might try to scupper a bill because of the constitutional danger it presented.
One senior government official said there was scarce detail about how the government planned to reform the disciplinary process.
“We promised in the manifesto to reform the Lords to make it easier to expel peers, but like everything else we came into government with no plan and no ideas, standing on a manifesto we didn’t have the first clue how to implement,” they said.
“The result is we have done – yet again – a U-turn because it was clear that we had to do more than we did yesterday without having any idea of what that actually means.”
