Fergie's heading for ruin over €6m debt
Published 08/08/2010 | 05:00
THE duchess of York's debts have risen to almost £5m (€6m), causing fears in Britain's royal family that her best option is bankruptcy.
At least one senior financial Buckingham Palace adviser is reported to have recommended voluntary bankruptcy, even though this would cause acute embarrassment to the queen, the duke of York and others.
No senior member of the royal family has ever been declared bankrupt, but this is becoming increasingly likely for Sarah Ferguson.
"One key adviser believes the right thing is for the duchess of York to go bankrupt. He says it will be a week-long wonder, then everyone will say, 'It's not altogether surprising' and forget about it," a senior royal source said.
However, the duke of York, who, with his private office is masterminding the "rescue plan", knows she is desperate to avoid bankruptcy.
Such a move would also be particularly embarrassing for him, because he is the UK's Special Representative for International Trade and Development. It is believed slightly more than half of the money owed relates to the US, where some of her legal fees have grown out of control.
The interest alone on the debts totals several thousand pounds a week, and the duchess has no real income to pay off the money owed.
This is the latest in a series of embarrassments that the duchess has caused the royal family over the past two decades but, even now, the duke of York is being supportive towards the mother of his two daughters, the Princesses Beatrice and Eugenie.
In May, she was the victim of a tabloid newspaper sting in which she offered to sell access to her ex-husband for £500,000 (€600,000). An undercover News Of The World reporter filmed her taking a £50,000 (€60,000) down-payment. She apologised for her "serious error of judgement".
Sources close to the royal family have said that the duke of York had paid off one large debt incurred by his former wife before the News Of The World story broke.
In the mid-1990s, the duchess amassed debts of £4.2m (€5m) but then, in her mid-30s, she went on a four-year earning spree in America, including writing her autobiography, to pay off the debts.
This time, however, at the age of 50, the situation is more serious because her earning power in the US has dipped along with her credibility.