By Jane Merrick
Ask Miss Whiplash which hand Osborne uses.
Bucharest, 2002. The ”Transition”
15 years ago
Showing posts with label George Osborne MP. Show all posts
Showing posts with label George Osborne MP. Show all posts
Thursday, 13 November 2008
Sunday, 26 October 2008
Osborne........The ruling class. running true to form
Dominatrix Natalie Rowe: I don't think he'd seen anything like that before
By Sara Nuwar, 26/10/2008, News of the World
THE hunger to hob-nob with the super-rich that landed George Osborne in such trouble this week came as no surprise to the vice queen who knew him well in his formative years.
For dominatrix Natalie Rowe saw at first hand the desperate longing of a gauche Oxford student struggling to fit in with the fabulously wealthy like university pal Nat Rothschild.
As the vice girl watched this week’s scandal unfold over Osborne’s dealings with Russian billionaire Oleg Deripaska on his yacht, she recalled how the young George—from the Osborne & Little fabrics family—was once snubbed by the sons of the gentry.
And she revealed how she and the young Tory were drawn together as she supplied girls and drugs to parties for some of Oxford’s notorious Bullingdon Club drinking circle. Its members included both Osborne and his former pal Rothschild, the man now accusing the top Tory of soliciting a £50,000 donation from aluminium tycoon Deripaska.
Slaves
Natalie told us: “I felt an empathy with George because we were both treated like outsiders. There was a bond between us.
“The others picked on him. He hadn’t gone to Eton, he wasn’t really one of them. He didn’t have blue blood, that’s why he didn’t quite fit in.
“They were all snobs. They called his dad a ‘curtain maker’. Because he was overweight they called him Jelly Belly and Georgie Porgy. He used to wear baggy jumpers to hide the flab.
“But he’s always been ambitious and he tolerated that bunch because he used them as a stepping-stone. He knew he had to hang around in the right circles to get where he wanted.”
And while Osborne loved rubbing shoulders with the mega- rich and aristocrats, he also found himself magnetically attracted to the sleazier side of life.
Miss Whiplash and vice madam Natalie, 45, revealed: “George was fascinated when he heard what I did for a living. He wanted to know about the clients, how much I charged, what went on. He seemed a bit more than curious about what went on.
“He wanted to see the equipment—the whips, the chains, the belts.
“He was particularly interested in the dog collars we put on clients and the rubber underpants they wear as submissive slaves.
“I don’t think he’d seen anything like that before.
“George was intrigued by all my stories and wanted to be shown how hard it would be to be hit. I told him that most of the guys tend to use the sex drug amyl nitrate. He smelt it but I don’t think he was too keen on it. He even met a client. Once George and his friends were at my flat while I was actually having a session with a paying customer.
“I had the man on all fours with a collar on and beat him. I was making him bark like a dog and act like a slave. They found it quite funny.
“None of them hid the fact they liked it and they weren’t embarrassed. They were turned on by it.”
Natalie, who styled herself as Mistress Pain and ran an escort agency called Black Beauties, met Osborne and Rothschild through her boyfriend at the time, fellow Bullingdon member William Sinclair, grandson of Winston Churchill’s wartime air minister Sir Archibald Sinclair.
He wanted to be shown how hard it would be to be hit
Our exclusive photograph of Natalie in a figure-hugging PVC dress was taken at her west London flat where she threw a string of wild parties. Osborne was a regular guest.
It was there the pair grew close. “George was attracted to me,” she recalled. “And I actually fancied him. In the beginning it was a turn on because it was our little secret, that electricity.
“I did kiss George. But to be honest he wasn’t that sexually experienced and he was a bit fumbly.
“I used to think he was a little bit of a wimp but I quite liked that.”
Osborne was offended when some members of the Oxford group would hurl racial slurs at Natalie. But she says that he was still so desperate to fit in that he didn’t have the courage to stop them. “There was one occasion they were taking the mickey out of me at a party,” she told us.
“They were making monkey noises and saying abusive things. They even used the word n*gger. George was there and I was hurt that he didn’t say anything.
“But he’d put his arms round me and comfort me and I did feel a connection. He didn’t stand up to the others, though. He didn’t want to upset them.” Despite that, Natalie insists she was still very fond of Osborne who she considered the nicest of the group of friends.
I felt an empathy with George. There was a bond between us
She said he was more compassionate than the others and would offer her advice on her rocky relationship with William.
“George and I would cuddle on the sofa and talk to each other about his friends,” she said.
“If I hadn’t been with William perhaps I could have been with George. We could have gone out with each other. There was an attraction and there was a time when we thought ‘Why is William in the equation?’”
The pair’s close friendship drew suspicions that they had fallen in love and, on one occasion jealous William even fought with the future Shadow Chancellor.
Natalie recalled: “George and I were sat on a two-seat sofa and William got offended when George whispered something to me.
“William demanded to know what we were talking about then lunged at George and chairs went flying. But they weren’t trying to punch each other out and it was all over in 20 seconds.
“They were all really close in that group, all of them.” Natalie said Osborne would be present when members of the group returned to her home for parties often involving cocaine, which Osborne has categorically denied taking with Natalie.
“When they had coke they would probably divvy up a gram and a half,” she said. “They’d have competitions to see who could snort the longest line and get completely wasted.
“George would drink vodka and white wine. When he drank he’d get really p***ed and start dancing and we’d have our little laughs together.
Dominatrix
“They all loved music by Elvis Presley. They’d also sing Gold by Spandau Ballet and George liked David Bowie’s Heroes.”
Remarkably, while sat in the home of a dominatrix, the 22-year-old Osborne bragged how he would one day become Prime Minister.
Natalie said: “He was absolutely sure about what he’d be doing. And I joked that I had all the evidence on him.”
On another occasion, after the birth of her son in 1996, Natalie says she met Osborne’s future wife at a dinner party. Frances, who married the MP in 1998, seemed shocked and disgusted at her line of work.
Natalie was this week intrigued how, given their once close friendship, the damaging claims that today threaten Osborne’s political future actually came from financier Nat Rothschild, heir to a family baronetcy and a £500 million banking fortune. She recalled how the two students and their band of pals would head to the country for wild weekends.
“The Bullingdon Club thought they were untouchable,” she said. “They thought they could do what they wanted. They had money and arrogance. They thought there were no consequences, anything goes.”
She said the group’s bad behaviour came to a head in March 1994 at the Rothschilds’ stately home, Waddesdon Manor in Buckinghamshire. She thinks both Nat and Osborne were among the 40-strong party.
Natalie sent three strippers and was asked to make sure the women were “tall, dark and slim and with figures like Naomi Campbell.”
Around six grams of cocaine were also provided for the club members to snort. As well as stripping, it was made clear that the girls’ services would extend to “extras”—sex with guests.
But Natalie claims the party degenerated into a humiliating experience for the girls who were abused by some braying Bullingdon boys.
Spitting
“The girls were made to feel like they were nothing,” she said. “They climbed on to the bar or a table and started to strip and gyrate. But the guests were mauling them and jeering. It was horrendous. The guys were trying to touch them and shouting abuse, throwing champagne and spitting.
“There was nothing decent in the way they treated the girls.
“Then it got down to who would sleep with who. Who was going to have the girls first.”
The woman were left shaken by the experience and enraged when one wealthy punter refused to pay the agreed £350 for his sex session.
As the girls tried to leave their car was surrounded by men who started to rock the vehicle. The police were called but no action was taken. Afterwards Osborne visited Natalie to apologise and Rothschild called to say sorry. “I was furious,” she said.
As Natalie this week surveyed the debris of Osborne’s relationship with his accuser Rothschild and pondered the reasons behind the row, she admitted: “I can’t believe George would want to annoy Nat. He knows so much about him.
“I can’t imagine why he’d want to get on the wrong side of him.
“But Osborne’s sloppy isn’t he?
“Remember that photograph he had taken with me and there was cocaine on the table? Who would do that. He’s not very careful.”
Friday, 24 October 2008
The Mafia paradise that holds secret to tycoons' alliance
By Richard Pendlebury and Neil Barnett
Last updated at 1:00 AM on 24th October 2008
Springtime in Brussels and a familiar figure is wreathed in smiles as he announces his latest diplomatic masterstroke.
After three years of talks Peter Mandelson, the EU Trade Commissoner, has secured a bilateral agreement with the tiny Adriatic nation of Montenegro. 'Today's signature is an important milestone,' he cooed. Montenegro's progress towards becoming a reliable world trading partner had been 'remarkable'
'Future Monaco': The port of Tivat in Montenegro is going to be transformed into the 'Monaco of the Adriatic' and has a tight circle of wealthy backers
Even so, one imagines that Montenegrin trade prospects rarely dominate small talk at the world's most glamorous restaurants. But they might well have done so at the Moscow dinner table we know Mandelson to have shared with his good friend, Oleg Deripaska, only a few weeks before the Brussels' announcement in April.
Or, indeed, on any of the other occasions when the commissioner has broken bread with the Russian and their mutual friend - and Deripaska's business partner and adviser - the British financier, Nat Rothschild.
Why? Because Deripaska, Russia's wealthiest man, is also the single largest private employer of Montenegro's 680,000 population, responsible for half of the nation's legitimate economic output.
Rothschild - who this week caused a political firestorm by accusing Geroge Osborne, the Tory Shadow Chancellor, of soliciting a £50,000 donation from Deripaska - also has a stake in one of the Russian's projects in Montenegro, as well as other heavy business links with him.
Tycoon alliance? Nat Rothschild (left) has a stake in one of Oleg Deripaska's projects in Montenegro
Indeed, this unholy alliance may very well be the key to understanding Rothschild's astonishing betrayal of his old university chum, Mr Osborne.
BUT why has a tiny state like Montenegro assumed such importance to Deripaska and his business partners? It is no secret that the country has a significant and well-established black economy. As one Balkan business analyst said: 'It is the one country in the region that isn't just bedevilled by corruption, it's a kleptocracy.'
Montenegro, which broke from a federal union with Serbia two years ago, has been governed by prime minister Milo Djukanovic since 1991.
More...
Mandelson to face questions over links to Russian tycoon and plans for a £5bn super-rich haven in Montenegro
The cast list of The Corfu Connection reads like something out of an Agatha Christie novel
Djukanovic is an interesting character. He had long been ' tolerated' by the West for opposing the regime of late Serbian tryrant Slobodan Milosevic. But allegations of links to hugely profitable, mafia-run tobacco smuggling between his country and the EU have seen him repeatedly investigated by Italian prosecutors.
If Djukanovic is the political leviathan of this tiny state, then his friend Deripaska, similarly tainted by alleged mafia-links, is his economic equivalent.
It is said that Djukanovic personally handled the controversial sale of Montenegro's most important state-owned industrial asset - the KAP aluminium firm - to a subsdidiary of Rusal, Deripaska's aluminium concern.
Rusal is the world's largest producer of the metal and benefited greatly from two EU aluminium import tariff cuts which were made while friend Mandelson was trade commissioner.
Some say that KAP was considerably underpriced. There are whispers of kickbacks. Others resent the way in which Russia has taken such a huge stake in their country.
Since 2001 Russia has commanded first place in the countries investing in Montenegro.
Investor: Lord Rothschild, father of Nat, is also on board for the Porto Montenegro marina development near the town of Tivat
Tourism from Russia has rocketed, too. But the main source of investment in recent times has been in real estate, mostly along the gorgeous Adriatic coast.
There are those cynics who say that much of the Russian property investment is a money laundering operation by criminal elements from the Russian Federation.
Of course, there is no suggestion that this might explain Mr Deripaska's interests in the region.
But there is undoubtedly one project for which he has particularly-high hopes - or at least had before the credit crunch shrank his £14billion fortune. That is the extraordinary Porto Montenegro marina development near the town of Tivat.
It is often said of Monaco that it's 'a sunny place for shady people'. Given the identities of some of its recent investors, much the same could be said of the beautiful Montenegran coast.
But at Tivat they really are going to build what has been billed 'the Monaco of the Adriatic'. A Four Seasons hotel is part of the multi-billion-pound plan, as well as hundreds of luxury appartments and berthing for 800 boats - 150 of them superyachts.
Once again prime minister Djukanovic was personally involved in the negotiations, which saw an abandoned ex-Yugoslav naval base and dockyard sold to foreign investors in early 2006. Once again there were allegations of underpricing.
The yard was bought by a firm called TriGranit, Hungary's biggest property developer. It is co-owned by a Hungarian-born Canadian billionaire named Peter Munk and Nat Rothschild.
Munk, 80, is owner of Barrick Gold, the world's largest gold producing company. He was advised to invest in Montenegro by the Rothschild family, with whom he has long enjoyed business ties.
Then he made a call to Deripaska. 'Oleg made the first phone call to the prime minister (Djukanovic) and opened the door for me,' Mr Munk explained.
But Munk and Rothschild were not alone in the project. Also on board are Nat's father Lord Rothschild and two other business big names. One, Bernard Arnault, the chairman of luxury goods conglomerate LVMH, adds lustre.
The other - Deripaska himself - adds a blizzard of cash and a warship-sized yacht, the 283ft Queen K, which has been the subject of recent notoriety as a honeypot for Britain's political elite.
Work on the Montenegrin project is already well under way. Giant palm trees have been brought in from Spain, the pier fenders are lined with African teak and fountains made from Venezuelan stone tinkle prettily.
Porto Montenegro should open for business next year. PM Djukanovic hopes that he can persuade the EU to accept Montenegro as a member by 2012, which should help the Tivat development considerably.
Certainly, its tight circle of wealthy backers have much at stake. Munk sits on the international advisory board of Rusal, Deripska's metals giant. Nat Rothschild (whose JNR firm advises Deripaska) sits on the equivalent board at Barrick Gold.
In return, Munk has reportedly invested heavily in Nat Rothschild's New Yorkbased Atticus hedge fund.
How very cosy. But this nexus of tens of millions of pounds of wealth has been much reduced in recent weeks and is still precarious, thanks to the world financial downturn. Fear stalks the oligarch mansions.
Even Deripaska is reportedly struggling to meet debt repayments on a part of his metals empire and will have to liquidate assets.
In this fraught enviroment, George Osborne - the Shadow Chancellor - made a stupid misjudgment.
He chose to score a cheap political point by leaking embarrassing remarks about Peter Mandelson - the same Commisioner Mandelson who had so enthusiastically praised Montenegrin economic progress and had shown a liking for tariff cuts.
And by so doing, Osborne also unwittingly shone an unwelcome light on Mr Rothschild's most important business partner, Mr Deripaska.
So Rothschild went on the attack. When business is this stormy, you have to choose your place of shelter. And Rothschild's was the Porto Montenegro connection.
Last updated at 1:00 AM on 24th October 2008
Springtime in Brussels and a familiar figure is wreathed in smiles as he announces his latest diplomatic masterstroke.
After three years of talks Peter Mandelson, the EU Trade Commissoner, has secured a bilateral agreement with the tiny Adriatic nation of Montenegro. 'Today's signature is an important milestone,' he cooed. Montenegro's progress towards becoming a reliable world trading partner had been 'remarkable'
'Future Monaco': The port of Tivat in Montenegro is going to be transformed into the 'Monaco of the Adriatic' and has a tight circle of wealthy backers
Even so, one imagines that Montenegrin trade prospects rarely dominate small talk at the world's most glamorous restaurants. But they might well have done so at the Moscow dinner table we know Mandelson to have shared with his good friend, Oleg Deripaska, only a few weeks before the Brussels' announcement in April.
Or, indeed, on any of the other occasions when the commissioner has broken bread with the Russian and their mutual friend - and Deripaska's business partner and adviser - the British financier, Nat Rothschild.
Why? Because Deripaska, Russia's wealthiest man, is also the single largest private employer of Montenegro's 680,000 population, responsible for half of the nation's legitimate economic output.
Rothschild - who this week caused a political firestorm by accusing Geroge Osborne, the Tory Shadow Chancellor, of soliciting a £50,000 donation from Deripaska - also has a stake in one of the Russian's projects in Montenegro, as well as other heavy business links with him.
Tycoon alliance? Nat Rothschild (left) has a stake in one of Oleg Deripaska's projects in Montenegro
Indeed, this unholy alliance may very well be the key to understanding Rothschild's astonishing betrayal of his old university chum, Mr Osborne.
BUT why has a tiny state like Montenegro assumed such importance to Deripaska and his business partners? It is no secret that the country has a significant and well-established black economy. As one Balkan business analyst said: 'It is the one country in the region that isn't just bedevilled by corruption, it's a kleptocracy.'
Montenegro, which broke from a federal union with Serbia two years ago, has been governed by prime minister Milo Djukanovic since 1991.
More...
Mandelson to face questions over links to Russian tycoon and plans for a £5bn super-rich haven in Montenegro
The cast list of The Corfu Connection reads like something out of an Agatha Christie novel
Djukanovic is an interesting character. He had long been ' tolerated' by the West for opposing the regime of late Serbian tryrant Slobodan Milosevic. But allegations of links to hugely profitable, mafia-run tobacco smuggling between his country and the EU have seen him repeatedly investigated by Italian prosecutors.
If Djukanovic is the political leviathan of this tiny state, then his friend Deripaska, similarly tainted by alleged mafia-links, is his economic equivalent.
It is said that Djukanovic personally handled the controversial sale of Montenegro's most important state-owned industrial asset - the KAP aluminium firm - to a subsdidiary of Rusal, Deripaska's aluminium concern.
Rusal is the world's largest producer of the metal and benefited greatly from two EU aluminium import tariff cuts which were made while friend Mandelson was trade commissioner.
Some say that KAP was considerably underpriced. There are whispers of kickbacks. Others resent the way in which Russia has taken such a huge stake in their country.
Since 2001 Russia has commanded first place in the countries investing in Montenegro.
Investor: Lord Rothschild, father of Nat, is also on board for the Porto Montenegro marina development near the town of Tivat
Tourism from Russia has rocketed, too. But the main source of investment in recent times has been in real estate, mostly along the gorgeous Adriatic coast.
There are those cynics who say that much of the Russian property investment is a money laundering operation by criminal elements from the Russian Federation.
Of course, there is no suggestion that this might explain Mr Deripaska's interests in the region.
But there is undoubtedly one project for which he has particularly-high hopes - or at least had before the credit crunch shrank his £14billion fortune. That is the extraordinary Porto Montenegro marina development near the town of Tivat.
It is often said of Monaco that it's 'a sunny place for shady people'. Given the identities of some of its recent investors, much the same could be said of the beautiful Montenegran coast.
But at Tivat they really are going to build what has been billed 'the Monaco of the Adriatic'. A Four Seasons hotel is part of the multi-billion-pound plan, as well as hundreds of luxury appartments and berthing for 800 boats - 150 of them superyachts.
Once again prime minister Djukanovic was personally involved in the negotiations, which saw an abandoned ex-Yugoslav naval base and dockyard sold to foreign investors in early 2006. Once again there were allegations of underpricing.
The yard was bought by a firm called TriGranit, Hungary's biggest property developer. It is co-owned by a Hungarian-born Canadian billionaire named Peter Munk and Nat Rothschild.
Munk, 80, is owner of Barrick Gold, the world's largest gold producing company. He was advised to invest in Montenegro by the Rothschild family, with whom he has long enjoyed business ties.
Then he made a call to Deripaska. 'Oleg made the first phone call to the prime minister (Djukanovic) and opened the door for me,' Mr Munk explained.
But Munk and Rothschild were not alone in the project. Also on board are Nat's father Lord Rothschild and two other business big names. One, Bernard Arnault, the chairman of luxury goods conglomerate LVMH, adds lustre.
The other - Deripaska himself - adds a blizzard of cash and a warship-sized yacht, the 283ft Queen K, which has been the subject of recent notoriety as a honeypot for Britain's political elite.
Work on the Montenegrin project is already well under way. Giant palm trees have been brought in from Spain, the pier fenders are lined with African teak and fountains made from Venezuelan stone tinkle prettily.
Porto Montenegro should open for business next year. PM Djukanovic hopes that he can persuade the EU to accept Montenegro as a member by 2012, which should help the Tivat development considerably.
Certainly, its tight circle of wealthy backers have much at stake. Munk sits on the international advisory board of Rusal, Deripska's metals giant. Nat Rothschild (whose JNR firm advises Deripaska) sits on the equivalent board at Barrick Gold.
In return, Munk has reportedly invested heavily in Nat Rothschild's New Yorkbased Atticus hedge fund.
How very cosy. But this nexus of tens of millions of pounds of wealth has been much reduced in recent weeks and is still precarious, thanks to the world financial downturn. Fear stalks the oligarch mansions.
Even Deripaska is reportedly struggling to meet debt repayments on a part of his metals empire and will have to liquidate assets.
In this fraught enviroment, George Osborne - the Shadow Chancellor - made a stupid misjudgment.
He chose to score a cheap political point by leaking embarrassing remarks about Peter Mandelson - the same Commisioner Mandelson who had so enthusiastically praised Montenegrin economic progress and had shown a liking for tariff cuts.
And by so doing, Osborne also unwittingly shone an unwelcome light on Mr Rothschild's most important business partner, Mr Deripaska.
So Rothschild went on the attack. When business is this stormy, you have to choose your place of shelter. And Rothschild's was the Porto Montenegro connection.
MAIL COMMENT: A modern tale of money and sleaze
By Mail Comment
Last updated at 1:28 AM on 22nd October 2008
Nobody emerges with any credit from the drama of dazzling wealth, political intrigue and back-biting played out this summer on the Greek island of Corfu.
What did George Osborne think he was doing, accepting hospitality from a controversial Russian billionaire aboard his £80million yacht - or, for that matter, gossiping at a private dinner with the poisonous Peter Mandelson?
At best, the Shadow Chancellor was naive to allow himself to be drawn into the gilded world of his old Oxford chum, hedge fund manager Nathaniel Rothschild, on whose estate he was enjoying a free family holiday.
Shadow Chancellor George Osborne defends himself yesterday
At worst, it was highly improper of him to permit any discussion - no matter who started it - about the possibility of an illegal donation to the Tory Party by the yacht's owner, Oleg Deripaska.
Under David Cameron, the Conservatives have had an honourable record cleaning up party funding.
If Mr Osborne's ineptitude has indeed put that at risk, he forfeits all claim to our sympathy.
More...
Osborne is forced to admit he met oligarch FIVE times after crossing Mandelson (and just look who's smiling now)
Then there's the rather unappealing Mr Rothschild, a close business associate of Mr Deripaska. Whatever possessed him to write his vicious letter to the Times, putting the worst possible construction on Mr Osborne's behaviour? Some 'friend'.
Did somebody put pressure on him to land the Shadow Chancellor in the mire? Inevitably, the finger points at the man we must learn to call 'Lord' Mandelson.
Only a fortnight ago, it emerged that Mr Osborne had been regaling friends with stories of that private dinner, at which the then EU Commissioner had 'dripped poison' into his ear about Gordon Brown.
Shouldn't the Shadow Chancellor have learnt by now that anybody who spreads damaging tittle-tattle about the Prince of Darkness must expect a terrible revenge? How convenient for Lord Mandelson, too, that these allegations switch the spotlight from his own friendship with Mr Deripaska.
Only yesterday, more disturbing questions were raised about the EU's decision to lift tariffs on aluminium, which benefited the Russian billionaire to the tune of a cool £200million.
It now emerges that his association with Lord Mandelson goes back at least to January 2005 - much earlier than previously admitted and, crucially, before the decision on EU tariffs was taken.
When Lord Mandelson returned to the Cabinet, the Mail warned that offering him a third chance was a huge gamble.
We wrote: 'Any hint that he is spreading poison, doing favours for friends or greedily pursuing personal advancement will be swiftly punished.'
Less than three weeks on, with the miasma of sleaze hanging over the Government once again, our misgivings already seem horribly prescient.
But it's not only the Corfu mob who emerge badly from this affair. Isn't it quite incredible how the BBC has behaved?
On the Today programme, political editor Nick Robinson openly boasts that he 'resisted' making much of the yacht allegations when they concerned only Lord Mandelson. But now that a Tory is implicated, the corporation gets stuck into the story with all guns blazing.
Talk about double standards, from an organisation supposedly bound by its charter to impartiality.
On one point, though, Mr Robinson is right. The Corfu saga is a 'story of our modern times' - and what profoundly depressing reading it makes.
As for any lasting damage it may do to Mr Osborne, at least he can justly proclaim that the Tories accepted no money from Mr Deripaska (which is more than can be said for Labour and Bernie Ecclestone).
That may yet save him. Meanwhile, may we suggest that in future both he and Lord Mandelson choose their holiday companions with more care?
Last updated at 1:28 AM on 22nd October 2008
Nobody emerges with any credit from the drama of dazzling wealth, political intrigue and back-biting played out this summer on the Greek island of Corfu.
What did George Osborne think he was doing, accepting hospitality from a controversial Russian billionaire aboard his £80million yacht - or, for that matter, gossiping at a private dinner with the poisonous Peter Mandelson?
At best, the Shadow Chancellor was naive to allow himself to be drawn into the gilded world of his old Oxford chum, hedge fund manager Nathaniel Rothschild, on whose estate he was enjoying a free family holiday.
Shadow Chancellor George Osborne defends himself yesterday
At worst, it was highly improper of him to permit any discussion - no matter who started it - about the possibility of an illegal donation to the Tory Party by the yacht's owner, Oleg Deripaska.
Under David Cameron, the Conservatives have had an honourable record cleaning up party funding.
If Mr Osborne's ineptitude has indeed put that at risk, he forfeits all claim to our sympathy.
More...
Osborne is forced to admit he met oligarch FIVE times after crossing Mandelson (and just look who's smiling now)
Then there's the rather unappealing Mr Rothschild, a close business associate of Mr Deripaska. Whatever possessed him to write his vicious letter to the Times, putting the worst possible construction on Mr Osborne's behaviour? Some 'friend'.
Did somebody put pressure on him to land the Shadow Chancellor in the mire? Inevitably, the finger points at the man we must learn to call 'Lord' Mandelson.
Only a fortnight ago, it emerged that Mr Osborne had been regaling friends with stories of that private dinner, at which the then EU Commissioner had 'dripped poison' into his ear about Gordon Brown.
Shouldn't the Shadow Chancellor have learnt by now that anybody who spreads damaging tittle-tattle about the Prince of Darkness must expect a terrible revenge? How convenient for Lord Mandelson, too, that these allegations switch the spotlight from his own friendship with Mr Deripaska.
Only yesterday, more disturbing questions were raised about the EU's decision to lift tariffs on aluminium, which benefited the Russian billionaire to the tune of a cool £200million.
It now emerges that his association with Lord Mandelson goes back at least to January 2005 - much earlier than previously admitted and, crucially, before the decision on EU tariffs was taken.
When Lord Mandelson returned to the Cabinet, the Mail warned that offering him a third chance was a huge gamble.
We wrote: 'Any hint that he is spreading poison, doing favours for friends or greedily pursuing personal advancement will be swiftly punished.'
Less than three weeks on, with the miasma of sleaze hanging over the Government once again, our misgivings already seem horribly prescient.
But it's not only the Corfu mob who emerge badly from this affair. Isn't it quite incredible how the BBC has behaved?
On the Today programme, political editor Nick Robinson openly boasts that he 'resisted' making much of the yacht allegations when they concerned only Lord Mandelson. But now that a Tory is implicated, the corporation gets stuck into the story with all guns blazing.
Talk about double standards, from an organisation supposedly bound by its charter to impartiality.
On one point, though, Mr Robinson is right. The Corfu saga is a 'story of our modern times' - and what profoundly depressing reading it makes.
As for any lasting damage it may do to Mr Osborne, at least he can justly proclaim that the Tories accepted no money from Mr Deripaska (which is more than can be said for Labour and Bernie Ecclestone).
That may yet save him. Meanwhile, may we suggest that in future both he and Lord Mandelson choose their holiday companions with more care?
Osborne is forced to admit he met oligarch FIVE times after crossing Mandelson (and just look who's smiling now)… The Prince of Darkness.
By James Chapman and Michael Seamark
Last updated at 1:37 AM on 22nd October 2008
George Osborne is struggling to contain a political firestorm over illegal donations as he paid the price of crossing Peter Mandelson.
The Shadow Chancellor was forced to admit discussing a potential £50,000 gift to the Tory Party from Russia’s richest man, and that he met him five times in total.
Mr Osborne was left fighting for his reputation after what allies claimed was a dirty tricks campaign orchestrated by Lord Mandelson.
Happy birthday to me: Lord Mandelson, who turned 55 yesterday, looks jubilant as his rival George Osborne battled accusations he discussed an illegal donation
Labour’s new Business Secretary had blamed him for leaking embarrassing details of private remarks about Gordon Brown during a holiday in Corfu this summer, when both visited aluminium billionaire Oleg Deripaska’s yacht.
Yesterday the row took an extraordinary twist as one of the Shadow Chancellor’s oldest friends, Nat Rothschild, stabbed him in the back.
He claimed in a letter to the Times that while on board the yacht Mr Osborne attempted to ‘solicit’ money for the Conservatives from Mr Deripaska.
Donations from foreign residents are against the law, though a gift from one of Mr Deripaska’s companies trading in Britain would have been permitted.
Ill at ease: Mr Osborne answers a barrage of reporters' questions yesterday
Mr Rothschild, a friend of Mr Osborne and Lord Mandelson, was hosting guests at his family villa in Corfu and apparently invited both men on to Mr Deripaska’s yacht.
Mr Osborne held a press conference yesterday lunchtime at which he categorically denied the claim that he and chief Tory fundraiser Andrew Feldman had sought cash from the aluminium tycoon.
He insisted: ‘We didn’t ask for money; we didn’t receive any.’
But Mr Rothschild was telling friends he would not ‘back down’ over the allegations and was even prepared to defend them in court.
Sources close to him say they have a ‘silent witness’ - a wealthy American named Jim Goodwin - who was present in Corfu and will back up Mr Rothschild’s claims.
The row over the Shadow Chancellor conveniently overshadowed fresh claims that Lord Mandelson, who signed off changes which benefited Mr Deripaska’s firm while EU trade commissioner, had known the Russian for far longer than he implied.
David Cameron made clear that his closest ally’s job is secure, insisting he had shown good judgment by turning down any donation and disclosing full details of his meetings with Mr Deripaska.
Last night the Shadow Chancellor issued an extraordinary statement admitting that he met Mr Deripaska five times. Four meetings took place over one August weekend.
He insisted he had not solicited or received any donation, or ever discussed directly with Mr Deripaska the possibility of him giving money.
He was forced to concede that he had been involved in a conversation with Mr Rothschild over the possibility that the Russian oligarch could make a donation.
Knife in the back moment: Nat Rothschild and his accusing letter to The Times
However, he placed the blame firmly on Mr Rothschild - saying he had initiated the discussion - and effectively accused his friend of lying by claiming that he had ‘solicited’ cash.
Mr Osborne said Andrew Feldman had stated that a donation could come only from a ‘legitimate UK trading company’, while the Tories insisted that the possibility of a donation from Mr Deripaska or one of his companies was dismissed on the grounds it would ‘not be appropriate’.
But aides admitted that decision had never been relayed to Mr Rothschild. Despite Mr Cameron’s backing, some Tory MPs were privately questioning Mr Osborne’s judgment in entertaining even a brief discussion about a donation from a foreign source.
The row comes at the worst possible time for Mr Osborne, who has faced criticism over his response to the banking crisis.
Gift: Lord Rothchild's estate on Corfu where Mr Osborne enjoyed a free holiday
And it seems in danger of escalating after Mr Rothschild was said to be furious that his version of events in the letter to the Times had been questioned.
A source close to the banking heir said he had been ‘ incandescent’ with rage that his privacy had been invaded when Mr Osborne divulged private conversations with Lord Mandelson while enjoying his family’s hospitality.
The source said he had telephoned Mr Osborne to tell him he had decided to make his allegations public in a ‘highly emotional’ phone call.
The same source claimed that Lord Mandelson was ‘obviously pleased’ that the Tory donations row had erupted, but insisted he had not orchestrated it.
Shortly after his appointment as Business Secretary this month, Lord Mandelson was embarrassed by claims that he had told Mr Osborne that Gordon Brown had presided over a ‘culture of debt’ during the Corfu holiday, and ‘dripped poison’ about the Prime Minister.
He retorted at the time that he also had dirt to reveal from his unlikely heart-to-heart with the Shadow Chancellor.
Trappings of wealth: Billionaire Deripaska's superyacht Queen K in Venice
He issued what was widely seen as a threat to Mr Osborne when he said: ‘I would no sooner talk about in public what he said to me about his colleagues than I hope he would what I said about my colleagues.’
In his letter, Mr Rothschild said he was writing because it ‘ill behoves all political parties to try and make capital at the expense of another in such circumstances.’ He added: ‘ Perhaps in future it would be better if all involved accepted the
age- old adage that private parties are just that.’
He said Mr Osborne ‘found the opportunity of meeting with Mr Deripaska so good that he invited the Conservatives’ fundraiser Andrew Feldman, who was staying nearby, to accompany him on to Mr Deripaska’s boat to solicit a donation’.
He added: ‘Since Mr Deripaska is not a British citizen, it was suggested by Mr Feldman, in a subsequent conversation at which Mr Deripaska was not present, that the donation was "channelled" through one of Mr Deripaska’s British companies.
‘Mr Deripaska declined to make any donation. I mention this because it turns out that your obsession with Mr Mandelson is trivial in light of Mr Osborne’s actions.’
However, doubts were cast over Mr Rothschild’s version of events last night when it emerged that there were three different versions of his letter to the Times.
It was apparently amended twice because of legal concerns and clarifications to his account of the affair.
pictures will be posted soon
Last updated at 1:37 AM on 22nd October 2008
George Osborne is struggling to contain a political firestorm over illegal donations as he paid the price of crossing Peter Mandelson.
The Shadow Chancellor was forced to admit discussing a potential £50,000 gift to the Tory Party from Russia’s richest man, and that he met him five times in total.
Mr Osborne was left fighting for his reputation after what allies claimed was a dirty tricks campaign orchestrated by Lord Mandelson.
Happy birthday to me: Lord Mandelson, who turned 55 yesterday, looks jubilant as his rival George Osborne battled accusations he discussed an illegal donation
Labour’s new Business Secretary had blamed him for leaking embarrassing details of private remarks about Gordon Brown during a holiday in Corfu this summer, when both visited aluminium billionaire Oleg Deripaska’s yacht.
Yesterday the row took an extraordinary twist as one of the Shadow Chancellor’s oldest friends, Nat Rothschild, stabbed him in the back.
He claimed in a letter to the Times that while on board the yacht Mr Osborne attempted to ‘solicit’ money for the Conservatives from Mr Deripaska.
Donations from foreign residents are against the law, though a gift from one of Mr Deripaska’s companies trading in Britain would have been permitted.
Ill at ease: Mr Osborne answers a barrage of reporters' questions yesterday
Mr Rothschild, a friend of Mr Osborne and Lord Mandelson, was hosting guests at his family villa in Corfu and apparently invited both men on to Mr Deripaska’s yacht.
Mr Osborne held a press conference yesterday lunchtime at which he categorically denied the claim that he and chief Tory fundraiser Andrew Feldman had sought cash from the aluminium tycoon.
He insisted: ‘We didn’t ask for money; we didn’t receive any.’
But Mr Rothschild was telling friends he would not ‘back down’ over the allegations and was even prepared to defend them in court.
Sources close to him say they have a ‘silent witness’ - a wealthy American named Jim Goodwin - who was present in Corfu and will back up Mr Rothschild’s claims.
The row over the Shadow Chancellor conveniently overshadowed fresh claims that Lord Mandelson, who signed off changes which benefited Mr Deripaska’s firm while EU trade commissioner, had known the Russian for far longer than he implied.
David Cameron made clear that his closest ally’s job is secure, insisting he had shown good judgment by turning down any donation and disclosing full details of his meetings with Mr Deripaska.
Last night the Shadow Chancellor issued an extraordinary statement admitting that he met Mr Deripaska five times. Four meetings took place over one August weekend.
He insisted he had not solicited or received any donation, or ever discussed directly with Mr Deripaska the possibility of him giving money.
He was forced to concede that he had been involved in a conversation with Mr Rothschild over the possibility that the Russian oligarch could make a donation.
Knife in the back moment: Nat Rothschild and his accusing letter to The Times
However, he placed the blame firmly on Mr Rothschild - saying he had initiated the discussion - and effectively accused his friend of lying by claiming that he had ‘solicited’ cash.
Mr Osborne said Andrew Feldman had stated that a donation could come only from a ‘legitimate UK trading company’, while the Tories insisted that the possibility of a donation from Mr Deripaska or one of his companies was dismissed on the grounds it would ‘not be appropriate’.
But aides admitted that decision had never been relayed to Mr Rothschild. Despite Mr Cameron’s backing, some Tory MPs were privately questioning Mr Osborne’s judgment in entertaining even a brief discussion about a donation from a foreign source.
The row comes at the worst possible time for Mr Osborne, who has faced criticism over his response to the banking crisis.
Gift: Lord Rothchild's estate on Corfu where Mr Osborne enjoyed a free holiday
And it seems in danger of escalating after Mr Rothschild was said to be furious that his version of events in the letter to the Times had been questioned.
A source close to the banking heir said he had been ‘ incandescent’ with rage that his privacy had been invaded when Mr Osborne divulged private conversations with Lord Mandelson while enjoying his family’s hospitality.
The source said he had telephoned Mr Osborne to tell him he had decided to make his allegations public in a ‘highly emotional’ phone call.
The same source claimed that Lord Mandelson was ‘obviously pleased’ that the Tory donations row had erupted, but insisted he had not orchestrated it.
Shortly after his appointment as Business Secretary this month, Lord Mandelson was embarrassed by claims that he had told Mr Osborne that Gordon Brown had presided over a ‘culture of debt’ during the Corfu holiday, and ‘dripped poison’ about the Prime Minister.
He retorted at the time that he also had dirt to reveal from his unlikely heart-to-heart with the Shadow Chancellor.
Trappings of wealth: Billionaire Deripaska's superyacht Queen K in Venice
He issued what was widely seen as a threat to Mr Osborne when he said: ‘I would no sooner talk about in public what he said to me about his colleagues than I hope he would what I said about my colleagues.’
In his letter, Mr Rothschild said he was writing because it ‘ill behoves all political parties to try and make capital at the expense of another in such circumstances.’ He added: ‘ Perhaps in future it would be better if all involved accepted the
age- old adage that private parties are just that.’
He said Mr Osborne ‘found the opportunity of meeting with Mr Deripaska so good that he invited the Conservatives’ fundraiser Andrew Feldman, who was staying nearby, to accompany him on to Mr Deripaska’s boat to solicit a donation’.
He added: ‘Since Mr Deripaska is not a British citizen, it was suggested by Mr Feldman, in a subsequent conversation at which Mr Deripaska was not present, that the donation was "channelled" through one of Mr Deripaska’s British companies.
‘Mr Deripaska declined to make any donation. I mention this because it turns out that your obsession with Mr Mandelson is trivial in light of Mr Osborne’s actions.’
However, doubts were cast over Mr Rothschild’s version of events last night when it emerged that there were three different versions of his letter to the Times.
It was apparently amended twice because of legal concerns and clarifications to his account of the affair.
pictures will be posted soon
Tories hit back over yacht claims
21.10.08
Senior Tories were dragged into the furore over Lord Mandelson's stay on a Russian billionaire's yacht.
A friend of the new Business Secretary revealed that George Osborne and David Cameron's chief fundraiser Andrew Feldman also spent time on the Queen K this summer.
It was reported that the possibility of receiving a £50,000 donation from Oleg Deripaska - reputed to be Russia's richest man - was discussed.
The claims were made in a letter from Nathaniel Rothschild - an acquaintance of both Mr Osborne and Lord Mandelson - to The Times.
Mr Rothschild said that on the yacht, which was moored off Corfu, Mr Feldman suggested the oligarch could channel cash through one of his British companies.
Accepting donations from overseas residents is illegal, as is using a British company as a proxy to disguise an impermissible donation. But a Tory spokesman strongly denied the claims, and stressed that the party had not accepted money from Mr Deripaska.
"The allegations made in Mr Rothschild's letter are completely untrue," he said. "Both Andrew Feldman and George Osborne deny absolutely that they attempted to solicit a donation from Oleg Deripaska. Nor did they suggest a method by which he could conceal a donation via a British company.
"They spent a short period of time on Mr Deripaska's boat at the invitation of Mr Rothschild. Donations to the Conservative Party were not discussed with Mr Deripaska."
Conservative sources said Mr Rothschild had approached the party later and suggested that Mr Deripaska could give money, but the offer had been refused. The sources accused Mr Rothschild of changing his story when challenged.
The letter sent by banking heir Mr Rothschild - who was at Oxford with Mr Osborne and has strong links with the Tory Party - alleged that the shadow chancellor and Mr Feldman went on board Mr Deripaska's yacht "to solicit a donation".
Senior Tories were dragged into the furore over Lord Mandelson's stay on a Russian billionaire's yacht.
A friend of the new Business Secretary revealed that George Osborne and David Cameron's chief fundraiser Andrew Feldman also spent time on the Queen K this summer.
It was reported that the possibility of receiving a £50,000 donation from Oleg Deripaska - reputed to be Russia's richest man - was discussed.
The claims were made in a letter from Nathaniel Rothschild - an acquaintance of both Mr Osborne and Lord Mandelson - to The Times.
Mr Rothschild said that on the yacht, which was moored off Corfu, Mr Feldman suggested the oligarch could channel cash through one of his British companies.
Accepting donations from overseas residents is illegal, as is using a British company as a proxy to disguise an impermissible donation. But a Tory spokesman strongly denied the claims, and stressed that the party had not accepted money from Mr Deripaska.
"The allegations made in Mr Rothschild's letter are completely untrue," he said. "Both Andrew Feldman and George Osborne deny absolutely that they attempted to solicit a donation from Oleg Deripaska. Nor did they suggest a method by which he could conceal a donation via a British company.
"They spent a short period of time on Mr Deripaska's boat at the invitation of Mr Rothschild. Donations to the Conservative Party were not discussed with Mr Deripaska."
Conservative sources said Mr Rothschild had approached the party later and suggested that Mr Deripaska could give money, but the offer had been refused. The sources accused Mr Rothschild of changing his story when challenged.
The letter sent by banking heir Mr Rothschild - who was at Oxford with Mr Osborne and has strong links with the Tory Party - alleged that the shadow chancellor and Mr Feldman went on board Mr Deripaska's yacht "to solicit a donation".
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