Lord Peter Mandelson told Jeffrey Epstein in 2009 that the boss of JPMorgan should “mildly threaten” Britain’s chancellor over a tax on banker bonuses proposed by the government in which Mandelson was serving as business secretary, according to newly released documents.

Emails released by the US Department of Justice show Mandelson, who served in government under successive Labour administrations, trying to “amend” a supertax on bank bonuses announced by then chancellor Alistair Darling in December 2009.

The policy meant that bonuses over £25,000 would pay an additional 50 per cent tax rate. It was introduced in the wake of the financial crisis at a time when there was widespread public anger at the banking sector. Mandelson was business secretary and de facto deputy prime minister at the time.

A week after Darling announced the measure, Epstein, who was well-connected on Wall Street, was messaging Mandelson with suggestions for how Mandelson could soften the policy, according to the emails.

“[A]ny real chance of making the tax only on the cash portion of the bankers bonus,” Epstein wrote in an email on December 15.

Mandelson responded within minutes: “Trying hard to amend as I explained to Jes last night. Treasury digging in but I am on case.” Epstein replied with: “let me know before jes please”, in an apparent reference to Jes Staley, then a senior banker at JPMorgan.

Two days later on December 17, Epstein emailed Mandelson asking whether Jamie Dimon, chief executive of JPMorgan, should “call darling one more time?”

Mandelson replied, saying: “Yes and mildly threaten.”

Dan Neidle, head of think-tank Tax Policy Associates, said: “It is quite extraordinary for a serving government minister to advise a foreign bank to threaten the chancellor in order to reduce its UK tax bill.”

Source: The Financial Times

https://www.ft.com/content/91e8142a-3d4c-4222-a5ad-6548fc9907d1