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UK trade head quits over loan
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December 23, 1998: 8:33 a.m. ET
Mandelson resigns after failing to declare $625,000 loan from fellow MP
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LONDON (CNNfn) - U.K. Trade Secretary Peter Mandelson dramatically resigned Wednesday after admitting he had accepted a 373,000 pound ($625,000) loan from another politician whose business affairs his department is investigating.
Trade secretary Peter Mandelson admitted Tuesday he had accepted the loan to buy a house in London's fashionable Notting Hill district from Paymaster General Geoffrey Robinson, the man who signs government checks.
Mandelson is widely credited with bringing the ruling Labor party out of the political wilderness. When it was elected last year, it had spent 18 years out of office.
Mandelson was among the most pro-business faces within the new center-left Labor party. But prime minister Tony Blair made sleaze a central theme of the election campaign after the previous Conservative government was dogged by a succession of scandals involving sex and money.
Even his resignation might not save Mandelson from further investigations into claims that he may have improperly applied for a bank loan to cover the remaining cost of his 475,000 pound home.
Mandelson and Robinson have come under fire for not declaring their agreement, which critics say is in breach of the spirit of House of Commons rules.
The agreement goes back to 1996, before they became members of the government. The money was lent at an interest rate lower than that charged by U.K. banks.
But Robinson is currently the subject of an investigation by the trade department over possible breaches of corporate law. Mandelson says he had played no part in the investigation.
Robinson is due to make a statement this afternoon. 
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