Emails reveal Jeffrey Epstein brokered Lord Mandelson’s UK banking deal after Epstein's sex offence conviction. Photo / Getty Images
Jeffrey Epstein brokered a deal with Lord Mandelson over the sale of a United Kingdom taxpayer-owned banking business - after Epstein had been convicted of child sex offences, emails have revealed.
The £1b ($2.28b) deal was negotiated while Mandelson was Business Secretary and only months after Epstein had been released from prison.
Sempra Commodities, a joint venture between the taxpayer-owned Royal Bank of Scotland and Sempra Energy, was sold to JP Morgan in a deal on which Epstein gave advice to both Mandelson and to Jes Staley, a senior executive with JP Morgan who has since been banned from the City over his relationship with the disgraced financier.
On Tuesday night, the Tories demanded an investigation into Mandelson’s close friendship and any commercial dealings with Epstein.
They want to know if Epstein, who banked with JP Morgan and was one of its wealthiest clients, profited from the deal. Privately, some Labour MPs are also calling for Mandelson to resign because of the potential damage done to the UK’s reputation in America.
Victims of the convicted paedophile have demanded Lord Mandelson be sacked as British ambassador to the US, a position he has held since February this year. They have also questioned Sir Keir Starmer’s decision to appoint him to the post at a time when Epstein’s friendship with Lord Mandelson was well documented.
Lord Mandelson’s close ties to Epstein have come under intense scrutiny after he described the financier as his “best pal” in a 10-page letter that was made public on Monday night.
The Telegraph has established that the two men remained friends for almost two decades – and even after Epstein was jailed for a child sex offence in 2008.
On Monday night, the US House Oversight Committee, which is investigating the paedophile’s network of friends, published a 238-page album of messages compiled for Epstein’s 50th birthday in 2003.
It included a handwritten message from Lord Mandelson, together with a series of photographs taken on Epstein’s private Caribbean island, Little St James. In one picture, Lord Mandelson is pictured in a bathrobe laughing with Epstein on a veranda.
Epstein’s former housekeeper told The Telegraph the photos were taken in 2002, when the Labour peer stayed on the island for almost a week. Epstein’s abuse of underage girls was well under way by that time.
In his letter to Epstein, Lord Mandelson said: “Once upon a time, an intelligent, sharp-witted man they call ‘mysterious’ parachuted into my life”.
On another page, beside a picture of Little St James, the peer wrote about Epstein entertaining “in one of his glorious homes he likes to share with his friends (yum yum)”.
It concluded: “But wherever he is in the world, he remains my best pal! Happy Birthday Jeffrey. We love you!!”.
The birthday book, compiled by Epstein’s former girlfriend Ghislaine Maxwell – who is serving a 20-year prison sentence for child sex trafficking – includes messages from dozens of his associates, some of which include disturbing references to Epstein’s behaviour.
Sarah Ransome, 41, one of Epstein’s British victims, told The Telegraph: “Something is really, really wrong here. Peter Mandelson should not be ambassador. He needs to be fired. He is unsuitable to be ambassador”.
She also questioned the Prime Minister’s judgment in appointing Lord Mandelson to represent Britain in Washington DC when it was already public knowledge that he and Epstein were close friends.
“Keir Starmer must have known all this. Everybody knew about Peter Mandelson’s close friendship with Epstein,” she said.
Emails, made available in a United States court case, show that Lord Mandelson, Epstein and a senior banker at JP Morgan discussed in 2010 the sale of an energy trading company that was part-owned by the British Government.
A few months earlier, while Epstein was in prison in Florida for solicitation of a minor, Lord Mandelson, who at the time was Business Secretary and effectively Deputy Prime Minister, stayed in Epstein’s New York mansion.
The emails show Epstein introducing Lord Mandelson to Jes Staley, JP Morgan’s head of corporate and investment banking. Epstein frequently offered advice to Staley.
The email correspondence shows that Epstein was involved in setting up at least two meetings between Staley and Lord Mandelson prior to JP Morgan purchasing Sempra, the energy trading company of the Royal Bank of Scotland (RBS). The bank had been brought under state control following the financial crisis in 2008 and the Labour Government had wanted to recoup some of that cash by selling off its assets.
In one email, Epstein told Staley that Lord Mandelson was staying at his New York home and he should meet him there. In another, they discussed JP Morgan’s strategy for buying Sempra after Staley had met Lord Mandelson at the World Economic Forum in Davos.
From: EPSTEIN, Jeffery
To: STALEY, Jes
Sent: 17 June 2009
[...] peter will be staying at 71 st over weekend, do you want to organize either you, or you and Jamie,, quiertly (sic), up to you.
From: STALEY, Jes
To: EPSTEIN, Jeffery
Sent: 29 January 2010
[...] Saw Peter last night. Darling in 20 minutes. Will talk again with Peter this AM
From: EPSTEIN, Jeffery
To: STALEY, Jes
Sent: 29 January 2010
my view is sempra is an asset that comes up once every ten years. How does it fit in the global strategy?. does it give energy expertise. That is one of the big world needs.
After that meeting on January 29 2010, Epstein asked Mr Staley: “was petie helpful?”
The deal to buy part of Sempra from RBS was announced a little over two weeks later on February 16 2010.
According to sources, Epstein repeatedly referred to Lord Mandelson as “petie” in messages and conversations in a seeming show of affection.
From: EPSTEIN, Jeffery
To: STALEY, Jes
Sent: 8 October 2010
[...] would it make sense to have peter have a relationship with cazanov,
From: EPSTEIN, Jeffery
To: STALEY, Jes
Sent: 20 October 2010
[...] petie is just back from russia and now in london
US Virgin Islands lawyers, who were suing JP Morgan and Mr Staley for keeping Epstein as a client even after his initial arrest in 2006, concluded the discussions “appear to be related to JPMC [JP Morgan Chase] efforts to purchase Royal Bank of Scotland’s stake in Sempra Energy”. The case was eventually settled in 2023 before it reached court with JP Morgan paying the US Virgin Islands $75 million.
The emails, obtained by the US Virgin Islands authorities, also suggest that Lord Mandelson continued to discuss UK and US government policy with Epstein after the deal was struck.
The deal had not been as lucrative as the UK government had wished because Barack Obama had launched a crackdown on US investment banks. It meant that JP Morgan was unable to buy Sempra’s US trading arm.
Lord Mandelson and Epstein then appear to have held discussions about US banking policy over dinner in New York. The next day, Lord Mandelson gave a speech in New York in which he heavily criticised Mr Obama’s administration for curtailing the activities of the investment banks. In the same month, Lord Mandelson asked Epstein if Mr Staley “could send me email on issues” in relation to Obama’s new banking rules.
From: MANDELSON, Peter
To: EPSTEIN, Jeffery
Sent: 27 May 2010
This is thing I am speaking to in Shanghai. If you can open the attachment you will see that the entire Chinese banking fraternity is attending. Isn’t it something that JPM should be represented at if they want to spread their wings in china?
FWD From: EPSTEIN, Jeffery
To: STALEY, Jes
Sent: 27 May 2010
I think he is right. You should read attachments
From:MANDELSON, PeterThis is thing I am speaking to in Shanghai. If you can open the attachment you will see that the entire Chinese banking fraternity is attending. Isn’t it something that JPM should be represented at if they want to spread their wings in china?
JP Morgan declined to comment on Tuesday evening. Lord Mandelson also declined to comment. He has previously expressed deep regret over his friendship with Epstein, saying: ‘I wish I’d never met him.” When asked by the Financial Times about his relationship with Epstein earlier this year, he told the reporter: “F--- off” and accused the newspaper of being “obsessed”. But he has also said he regretted “even more the hurt” that Epstein had “caused to young women”.
Spencer Kuvin, an attorney who represented nine of Epstein’s victims, said: “By allowing someone with clear ties to one of the worst sex abusers of our time to be ambassador is an insult to the victims of Epstein.
“This man should be questioned by the FBI and the UK government immediately to find out what he knows.”
Cathy Alexander, Epstein’s former housekeeper, told The Telegraph that Lord Mandelson stayed on the island in 2002 with his now husband, Reinaldo Avila da Silva.
She said they stayed for almost a week, having been greeted there by Maxwell, and remembered him having “a panic attack or a migraine” after spending too much time in the sun.
Alexander identified herself as one of the women in a picture of Lord Mandelson at a breakfast table, and said the other woman, whose face is obscured, appeared to be Maxwell.
On Tuesday, the Conservative MP Sir Gavin Williamson wrote to Sir Keir asking whether Lord Mandelson was properly vetted before being appointed to his diplomatic role.
He also asked: “Do you believe Lord Mandelson’s conduct and association with a convicted paedophile to be in line with the requirements of the Diplomatic Service Code?”.
Lord Mandelson was brought back to the political front line by Sir Keir and sent to Washington earlier this year to help navigate Donald Trump’s presidency.
The former Cabinet minister and adviser from the New Labour years is said by insiders to have played a key role in Sir Keir and Mr Trump – who is due to visit the UK next week – forming a good early relationship.
But now some Labour MPs are privately calling on Lord Mandelson to quit or for the Prime Minister to sack him.
One Labour MP told The Telegraph: “Mandelson has to be responsible for the associations and friendships that he forms. We can make a judgment quite legitimately on relationships that he has made.
“It’s not good enough to say ‘whoops, I shouldn’t be associated with him now’. You shouldn’t have been associated with him then.”
A second Labour MP said: “He ought to resign. He knows how to stand down, after all. This would be the third time at least”.
The Prime Minister’s official spokesman said he had no plans to speak to Lord Mandelson about the letter, and declined to say whether Sir Keir knew about the extent of Lord Mandelson’s friendship with Epstein, or whether he knew about the photo album.
The spokesman added: “The ambassador’s played a key part in all of the achievements … when it comes to strengthening the trade relationship with the US, the UK-US defence deal, and work to end Putin’s war.”
Lord Mandelson was a backbench MP at the time he stayed on Little St James, having resigned as Northern Ireland secretary over accusations he used his position to influence a passport application on behalf of Srichand Hinduja, an Indian businessman. He had previously served as trade and industry secretary, but resigned from that post over a scandal involving an undeclared home loan from his Cabinet colleague Geoffrey Robinson.
Epstein was found dead in his cell at a federal jail in Manhattan in August 2019 while he awaited trial on sex-trafficking charges.