The governor of the Bank of England said he was “shocked” by revelations that Lord Mandelson passed confidential government information to Jeffrey Epstein during the 2008 financial crisis and said it was right that the matter was now being investigated by police.
Andrew Bailey made the comments as he paid tribute to the late former chancellor Alistair Darling, drawing a sharp contrast between Darling’s behavior during the crisis and the former business secretary’s alleged actions.
Asked whether sufficient safeguards were in place to prevent those in power from misusing market-sensitive information, Bailey said there was a “very clear” legal framework for dealing with potential breaches and that it was appropriate for the Mandelson allegations to be dealt with by law enforcement.
He also stressed that the focus should remain on Epstein’s victims, asking: “How is it that we live in a society where this happened and was allowed to happen?”
Bailey appeared visibly emotional as he reflected on images showing Mandelson alongside Darling during the crisis. He described Darling as someone who acted with “honesty and decency” while helping steer Britain through one of the worst financial crises in modern history.
“Alistair Darling did everything right,” Bailey said. “He carried it out with a strong sense of integrity and unfortunately cannot speak for himself today.”
Darling died in November 2023 at the age of 70.
The comments follow reports that Mandelson informed Epstein of the Labor government’s decision to cap bonuses for bankers after the financial crash and that he tried to persuade the Treasury to abandon the policy. The revelations sparked a police investigation.
Bailey said he was “shocked by what we have heard about this time” and reiterated that the harm suffered by Epstein’s victims must take precedence, not the reputation of those involved.
The Bank of England governor had previously come under criticism over Epstein over his role as head of the Financial Conduct Authority, when the regulator was investigating Jes Staley, the former chief executive of Barclays, over his relationship with the disgraced financier.
Staley unsuccessfully challenged the FCA’s decision to bar him from senior positions in the financial services sector. The court upheld the regulator’s finding that he acted with a lack of integrity by misleading them about the nature of his ties to Epstein. While the ban was upheld, the court reduced a fine imposed on Staley.
At the heart of this case were several emails between Staley and Epstein, some of which later became public and raised broader concerns about accountability and conduct at the highest levels of finance and government.
