The Liberal Democrats have escalated pressure on financial regulators by demanding an urgent investigation into former Business Secretary Peter Mandelson, following explosive revelations about his alleged sharing of confidential government information with convicted sex offender Jeffrey Epstein during the global financial crisis.
Formal Call for Financial Watchdog Action
In a formal letter addressed to Financial Conduct Authority chief executive Nikhil Rathi, Liberal Democrat deputy leader Daisy Cooper has called for immediate action to determine whether Mandelson or his associates profited from access to sensitive government material. Cooper emphasized that establishing the facts surrounding these allegations is "crucial" for maintaining market integrity and public trust in financial systems.
Revelations from Epstein Document Release
The political intervention follows the publication of emails in the latest batch of Epstein files, which appear to show Mandelson providing Epstein with advance notice of major fiscal and political developments while serving under Prime Minister Gordon Brown. Among the sensitive information allegedly shared were details of a massive €500 billion eurozone rescue package and Brown's impending resignation announcement in 2010 - both events that significantly moved currency and equity markets during a period of extreme economic volatility.
Cooper stated that the apparent sharing of such material "could easily have provided an unfair and lucrative advantage in the financial markets" to either Epstein himself or his network of associates. She further suggested that Mandelson "could also have personally profited" from these actions, adding that criminal prosecution should follow if evidence emerges of trading law violations.
Parallel Criminal Investigation Underway
The FCA letter coincides with an ongoing criminal investigation by the Metropolitan Police, who are examining allegations that Mandelson leaked market-sensitive information to Epstein at the height of the financial crisis. Police authorities have confirmed they are reviewing multiple reports relating to potential misconduct in public office, a serious offense under UK law.
Mandelson's Response and Political Fallout
While Mandelson has consistently denied any wrongdoing, the allegations have already triggered significant political consequences. The former minister has resigned from the House of Lords and severed ties with the Labour Party following the disclosures. Additionally, he was removed from his position as UK ambassador to the United States last year after fresh questions emerged regarding the depth of his relationship with Epstein, who died in prison in 2019 while awaiting trial on sex-trafficking charges.
Among the specific emails cited by critics are communications in which Mandelson appears to forward a confidential Treasury document outlining £20 billion of potential asset sales in 2009. Another message suggests that then JPMorgan chief executive Jamie Dimon should "mildly threaten" the government over a proposed bankers' bonus tax, though JPMorgan itself has not been accused of any wrongdoing in connection with these communications.
Regulatory Response and Legal Implications
A spokesperson for the Financial Conduct Authority responded to the Liberal Democrats' demands by noting that "The Metropolitan Police has already announced a criminal investigation. It wouldn't be appropriate to comment any further." This cautious approach reflects the sensitivity of ongoing investigations while acknowledging the seriousness of the allegations.
Under UK law, insider dealing carries severe penalties including potential prison sentences of up to 10 years, highlighting the gravity of the accusations against the former minister. The case raises significant questions about the intersection of political power, confidential information, and financial market integrity during one of the most turbulent economic periods in recent history.
