Italian officials say Culture Secretary Tessa Jowells' husband David Mills, 61, was paid to give false evidence in court for Italian premier Silvio Berlusconi. Mr Mills denies that. He admits writing a letter to his accountants where he appears to be describing a payment, but claims he was inventing a scenario to get tax advice. Here is the full text of that letter:
David Mills admits writing a letter to his accountants
2 February 2004
The brief relevant facts are these.
In 1996 I ended up with a dividend from Mr B's companies of around £1.5m after all the tax and fees had been paid.
This was all done on a personal basis: I took the risk, and kept my partners right out of it.
Wisely or otherwise, I informed my partners what I had done and, since it was a substantial windfall, offered to pay them (I think) around £50,000 or £100,000 each as what I though [sic] was a pretty generous gesture.
Which shows you how you can be, as they insisted the transaction should be treated as a partnership profit. To avoid litigation (we had just merged with Withers) I agreed to put the money on deposit in my bank until they were satisfied that there would be no third part claim.
By 2000 it was clear there would be no claim (I knew that all along) and the money was taken off deposit and paid out; I kept just under £500,000 out of what was then getting on for £2m.
So all that risk and cost for not very much. The greatest cost was leaving Withers. I was not asked to leave it, but felt so uncomfortable there, not least because my Mackenzie Mills partners had taken most of the benefit for none of the risk, that I really couldn't stay.
I spent 1998, 1999 and 2000 as a sole practitioner, and it was evident that the trials were going on, there would be lawyers to pay and there was always the risk of being charged with something - which is actually about to happen now as a result of the latest investigation, which you know about.
I kept in close touch with the B people, and they knew my circumstances.
They knew, in particular, how my partners had taken most of the dividend; they also knew quite how much the way in which I had been able to give my evidence (I told no lies, but I turned some very tricky corners, to put it mildly) had kept Mr B out of a great deal of trouble that I would have landed him in if I had said all I knew.
At around the end of 1999, I was told I would receive money, which I could treat as a long term loan or a gift. $600,000 was put in a hedge fund and I was told it would be there if I needed it.
(It was put in the fund because the person connected to the B organisations was someone I had discussed this fund with on many occasions, and it was a round about way of making the money available.)
For obvious reasons of their own (I was at that stage still a prosecution witness, but my evidence had been given) it needed to be done discreetly. And this was a roundabout way.
At the end of 2000 I wanted to invest in another fund, and my bank made a loan of the amount, secured on my house etc., of around 650,000 euros. I paid it off by liquidating the $600,000. I attach a copy of the dollar account.
I regarded the payment as a gift. What else could it be? I wasn't employed, I wasn't acting for them, I wasn't doing anything for them, I had already given my evidence, but there was certainly the risk of future legal costs (as there have been) and a great deal of anxiety (as there certainly have been).
This has been going on for more than eight years now. My contract was aware of how my income earning capacity had been damaged, and in 1998 and 1999 I was able to send bills from my practice to certain companies, which were paid and increased my income. But this was different.
Because I was pretty sure my CGT position was negative overall, I stupidly made no returns on my transactions. If they are closely looked at (i.e., where did the money come from to buy the centurion shares?), I am obviously concerned about what to do and how this should best be handled.
I attach the key documents.