BBC agrees settlement with Diana’s private secretary

The BBC has paid Diana, Princess of Wales’s private secretary, Patrick Jephson, a “substantial sum” in damages and apologised unreservedly for the “harm caused to him” over Martin Bashir’s Panorama interview.

Lord Dyson, a former master of the rolls and head of civil justice, was appointed to look into the circumstances surrounding the explosive 1995 interview, which famously featured Diana saying: “Well, there were three of us in this marriage, so it was a bit crowded.”

The investigation was launched after Earl Spencer alleged that Bashir showed him fake financial documents relating to his sister’s former private secretary and another former royal household member, and told outlandish and untrue stories about the royal family to gain access to the princess.

In a statement, the BBC said: “The BBC accepts and acknowledges that serious harm was caused to Commander Jephson as a result of the circumstances in which the 1995 interview with Diana, Princess of Wales, was obtained, which have become apparent as a result of the Dyson Report.

“The BBC apologises unreservedly to Commander Jephson for the harm caused to him and has paid his legal costs.

“The BBC has also paid Commander Jephson a substantial sum in damages, which he intends to donate in full to British charities nominated by him.”

The Dyson Inquiry found that the BBC covered up “deceitful behaviour” used by Bashir to secure his headline-making world exclusive interview with Diana, and “fell short of high standards of integrity and transparency”.

The journalist was in “serious breach” of the BBC’s producer guidelines when he faked bank statements and showed them to Earl Spencer to gain access to the princess in 1995, Lord Dyson’s report said.

Mr Jephson was Diana’s private secretary for eight years.