The Duke of York faced new controversy about his role as a UK trade envoy last night as it emerged that a former Soviet republic believed that he would help it to recruit British investors.
Kazakhstan, whose President’s son-in-law had previously bought the Duke’s former marital home for £3 million above the asking price, hoped that the Duke would persuade City investors that the country was a sound place to do business.
Critics questioned last night why Kazakhstan thought that the Prince would act as an ambassador for the country when he was meant to be representing British interests.
The details emerged on a day when the Duke’s position came under increasing pressure as:
* A government attempt to bolster him with endorsements from business leaders backfired when the comments were revealed to be old, and several companies, including Rolls-Royce, declined to repeat them;
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* David Cameron was silent about the Duke’s future, while touring the East Midlands on a Cabinet away-day;
* The Duchess of York apologised for a “gigantic error of judgment” in accepting money from the convicted sex offender Jeffrey Epstein after the Duke had discussed her financial plight with the American billionaire;
* UK Trade and Industry (UKTI) declined to say whether a planned trip by the Duke to Saudi Arabia would go ahead.
The Duke adopted a business-as-usual stance, appearing in East London and refusing to answer reporters’ questions about whether he would resign. Downing Street insisted that the Government supported the Duke, amid internal unease at earlier comments from No 10 sources that the Government would “shed no tears” at his departure, and that he was effectively on a yellow card.
But the Duke faced fresh embarrassment over his links to Kazakhstan, including to the socialite Goga Ashkenazi, who acted as a go-between on the sale of the Duke’s home and has a child with the buyer, Timur Kulibayev, the Kazakh President’s son-in-law.
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It emerged yesterday that the head of Kazakhstan’s $36.6 billion sovereign wealth fund said he hoped that the royal envoy would help to convince City investors that the country was not a risky place despite a banking crisis and a reputation for corruption.
Kairat Kelimbetov held a meeting with the Duke in April in last year in which he asked for his help in countering “stereotypes” of the country. “Prince Andrew expressed his readiness to help to organise meetings with business circles in Britain,” Mr Kelimbetov said after the meeting.
“We want to explain to British financial circles about the real results of Kazakh banks’ restructuring of foreign debt and to inform them about what’s really happening.”
Mr Kulibayev, who paid £15 million for Sunninghill Park in 2007 but has never occupied the property, is deputy chief executive of the fund. Ms Ashkenazi has said that she introduced Mr Kulibayev to the Duke, telling Hello! magazine last year: “It was like any property deal between friends.”
A Commons Business Committee source said that it would examine the new allegations. “This is a new issue, which we will have to take a look at. Our main concern is whether he is adding value to British exports.”
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The source added: “Our position has always been that he should remain in position as long as he does that. The issue has now become that whether the stories surrounding him will now prevent him from doing so. If he is to continue, the Government needs to give him a unified endorsement.”
Mike Gapes, a Labour member of the Foreign Affairs Select Committee, said that the Duke’s judgment meant “his position has become untenable”.
UKTI circulated endorsements of the Duke from 17 business leaders. However, the comments were from his own website, had been compiled last year, and some dated from several years earlier. Of the 17, six companies stuck by their endorsement and six did not return calls from The Times. One company, Biwater Europe, said the man quoted in its name, Neil Reynolds, had left “a couple of years ago”. Four others, Rolls-Royce, Invensys plc, International Power and BG Group, declined to stand by the endorsements.
A Buckingham Palace spokesman said: “The Duke met the head of the Kazakh sovereign wealth fund on an official visit, planned at the request of Government. He was asked in this meeting to identify British businesses who might want to expand into Kazakhstan, a country with which UKTI works closely.
“This is absolutely core business for the Special Representative — finding opportunities for British companies the world over, and in doing so it is incorrect to suggest he is working for Kazakhstan. He is working entirely for the UK.”