Finally, a Labour prime minister has taken a necessary step. Ordering the cabinet secretary to investigate Peter Mandelson’s contacts with Jeffrey Epstein recognises an elementary truth: if a cabinet minister discusses private government business with financial interests during a crisis, the state must act. Gordon Brown understood this instinctively. Sir Keir Starmer has moved later, and under pressure, but movement alone is not enough. Sir Keir said that Lord Mandelson should be stripped of his peerage while stopping short of legislating to make that happen. That is a choice. And it’s the wrong one to make.
The Epstein files make it hard to dismiss the question of misconduct in public office as frivolous. In 2003/04 it appears that as a Labour MP he received $75,000 from Jeffrey Epstein. Lord Mandelson says he has no recollection of these payments. Six years later, Lord Mandelson leaked sensitive government information during the banking crunch in 2009 to Epstein, a convicted sex offender, while serving in the cabinet. Emails suggest he advised US bank JP Morgan to “threaten” the UK chancellor, which by all accounts it did, over a proposed tax on bankers’ bonuses. The peer’s lobbying firm Global Counsel later had JP Morgan as a client.
Sir Keir’s judgment has been suspect since he hired Lord Mandelson, whose career has courted controversy, to be Britain’s ambassador to the US. The peer was eventually sacked over his links with Epstein. Yet even when the US Department of Justice released 3m documents from Epstein’s personal files featuring the peer thousands of times there was no automatic expulsion, no legislative action, no institutional reckoning. Once cash flows into a minister’s household while that minister is in office, the argument that there was “no personal benefit” disappears. “Have you permanently stopped the Reinaldo sub?” Lord Mandelson jokes with Epstein in 2010 in reference to money for his husband. This is household-level financial support from a disgraced financier to the family of a serving cabinet minister.
The payments, the files suggest, occurred when Lord Mandelson was business secretary. He publicly criticised the Obama administration’s proposed Volcker rules in a New York speech – an intervention that followed a private dinner with Epstein. Worse was to follow. On the evening of 9 May 2010, at the height of the eurozone crisis, emails suggest that Lord Mandelson messaged Epstein that a “€500bn bailout” was “almost complete”. The package was formally announced the following morning after an all-night summit. This was price-sensitive information about a massive and still-confidential rescue, passed to a private financier before markets opened. No trading need be alleged: the disclosure surely crossed the line.
Lord Mandelson should leave the House of Lords. His actions warrant investigation. But this is not just about one peer: it is a test for Labour’s pro‑business factions that valorise proximity to wealth as political maturity. Sir Keir’s Labour party has pursued “credibility” with markets. The Epstein affair reminds us that wealth is not morally neutral. As Balzac warned, behind every great fortune lies a great crime. Misconduct in public office concerns the abuse of public trust – so vague that it is rarely prosecuted in the UK. A new statutory offence to criminalise improper use of office is on its way. But a party that confuses access with virtue launders power for money.
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