Now Lord Mandy faces fresh questions over relationship with super-rich Russian oligarch

Peter Mandelson was at the centre of disturbing new questions last night over his relationship with one of the world's richest men. 

The controversial Business Secretary faces calls to make a statement to the House of Lords to explain more about his friendship with Russian Oleg Deripaska. 

Concerns over a 'potential conflict of interest' have arisen after two companies asked for Lord Mandelson's help following claims that one of Mr Deripaska's firms had cheated them over a $1billion (£575million) deal in Moscow.

The then European Trade Commissioner took up their case only for it to emerge that he had enjoyed hospitality aboard the 238ft yacht Queen K, owned by the very man who was the subject of the complaint. 

The magnificent Queen K, with a crew of 21 including a cordon bleu chef, has cabins for 16 guests and has undergone an extensive refurbishment since the Russian bought it two years ago.

With six decks, of which the topmost is entirely reserved for Mr Deripaska, the vessel has a pool, a jacuzzi, sauna and gym. 

The bathroom adjoining the master suite is clad in onyx, while the taps and fittings are gold. The spacious guest staterooms have marble bathrooms. 

A link between the newly ennobled Baron Mandelson of Foy in the County of Herefordshire and Hartlepool in the County of Durham and 40-year-old Mr Deripaska is believed first to have been made by his friend Nat Rothschild, a financier who advises the Russian tycoon, and his father Lord Rothschild.

The Queen K is said to have been moored off the north-eastern coast of Corfu, where the Rothschilds have a home, when the then-commissioner was seen aboard. 

When his presence on board was first reported, Lord Mandelson said he was merely attending a drinks party given by Mr Deripaska. He then said he had last seen Mr Deripaska at a dinner hosted by media tycoon Rupert Murdoch in Corfu.


It subsequently emerged he and other guests had been 'billeted' aboard the £80million yacht because Nat Rothschild had run out of room at his house in August. 

Last night politicians in both London and Brussels were planning to table questions demanding that Lord Mandelson make a statement to clarify why he failed to explain the potential conflict of interest.

Syed Kamall, Conservative MEP for London, said: 'He should come clean as soon as possible because as long as these allegations are swirling around they are a distraction from the very serious matters in which he and the Government are involved.' 

In addition, during his spell at the EU, Lord Mandelson twice acted to cut European import duties on aluminium from which Mr Deripaska's companies benefited by up to £50million a year, though there has been no suggestion he acted improperly. 

The issue will raise fresh questions over Lord Mandelson's judgment after he twice previously resigned from Cabinet posts over problems caused by his relationships with the rich and famous. continues here 

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