An email from Peter Mandelson and released in the Epstein files has prompted renewed political scrutiny over the former ambassador’s financial arrangements and judgement.
The message, dated March 30, 2011, and addressed to Jeffrey Epstein, discusses the purchase of a flat in Rio de Janeiro for Mandelson’s husband, Reinaldo, and sets out possible structures for reducing tax liabilities through offshore companies.
In the email, Mandelson writes:
“A lawyer in Rio has pointed out two problems in Reinaldo purchasing the Rio flat by means of a cash transfer from me, we would be liable to taxes in both UK and Brazil, and the purchase itself would be liable for two forms of property taxation in Brazil, 4% and 6% respectively of the full purchase price. This would be prohibitively expensive.”
He continues by outlining a suggested alternative:
“The lawyer suggests the following scheme which he has operated for others. He would buy create an offshore company in Panama and this company would open an account with HSBCPB in London. We would also create a Brazilian company which would have the Panamanian company as a partner, shares held by Reinaldo and me. The Brazilian company, managed by Reinaldo, would purchase the flat.”
The email goes on to state:
“The flat purchase would be financed by means of a loan from the Panamanian company’s account in London to justify the offshore, non taxable origin of the money.”
Mandelson adds that the lawyer proposed an initial investment:
“The lawyer proposes that I invest US$50,000 to buy the shares of the Brazilian company, making a residence permit in Brazil also possible.”
And concludes:
“As directors of the Brazilian company, Reinaldo and I would have joint control over the property.”
The appearance of the correspondence in the document released has reignited criticism from political opponents, who say the contents raise legitimate questions about Mandelson’s approach to tax planning and his judgement, particularly given his later appointment to one of the most sensitive diplomatic posts in British public life.
It also surfaced straight after Mandelson sought to limit media contact through a notice circulated to editors via the Independent Press Standards Organisation yesterday, asking journalists not to approach him directly while investigations and political rows continue.
Mandelson has previously denied wrongdoing, and has said he answered questions put to him during vetting for the ambassadorial role truthfully. Parliamentary committees and police are currently examining aspects of his conduct. His two properties were raided by police yesterday for evidence.
The Labour Party has faced broad criticism in recent months over standards and transparency, with opponents pointing to past tax controversies involving senior figures such as Angela Rayner, though Labour has rejected claims of systemic wrongdoing and has said it takes compliance with tax and ethics rules seriously.
For critics, however, the latest uncovered Mandelson email adds to a growing dossier of material that they say underlines the need for full disclosure about what advice he gave, what assurances were offered behind closed doors, and whether the government has been sufficiently transparent about his past dealings.
The unfolding controversy is now likely to intensify calls in Parliament for publication of further documents relating to Mandelson’s role in diplomacy, as well as for clearer explanations of how vetting and oversight were conducted before his appointment to Washington.
