Martin Bashir deployed deceitful methods in a breach of BBC editorial rules to secure his interview with Princess Diana, an official inquiry is understood to have concluded.
The BBC is braced on Thursday for a report that one well-placed source described as the corporation’s "phone hacking moment", in reference to the scandal that engulfed the News of the World.
The six-month inquiry conducted by Lord Dyson, the former Master of the Rolls, will criticise Bashir and is understood to condemn senior BBC executives at the time over allegations of a cover up.
Lord Dyson was brought in by the BBC to carry out an investigation into how Bashir, then a relatively unknown reporter, secured his world exclusive interview more than 25 years ago in which Princess Diana declared “there were three of us in this marriage”, in reference to the Prince of Wales’s infidelity with Camilla Parker-Bowles.
The retired judge has concluded that Bashir breached editorial guidelines in mocking up bank statements which were shown to Earl Spencer and allegedly used to win over his trust and gain access to his sister.
A source said: "It will be a true eye-opener. This could be the BBC's phone hacking moment."
Earl Spencer supplied a dossier of evidence to Lord Dyson, including eight pages of notes which he made of a conversation between Bashir and Princess Diana at their first meeting on September 19 1995, some two months before the interview took place.
The Telegraph has seen a copy of those notes, which include a list of allegations (purportedly from Mr Bashir), including a suggestion that Princess Diana’s telephones were bugged and that she was being followed.
Lord Dyson has concluded that the use of the bank statements, showing false payments to Earl Spencer’s then head of security, breached the BBC’s editorial guidelines at the time.
Richard Ayre, the BBC’s controller of editorial policy in 1995, told The Telegraph that he had informed Lord Dyson in evidence given in January that Bashir would have breached guidelines in mocking up the statements and showing them to Earl Spencer.
Mr Ayre said he would never have allowed the statements to be faked and shown to Earl Spencer, adding: "The use of deceit in making factual programmes would have been permissible only in the case of investigating serious crime… and where prima facie evidence of the guilt of that person being investigated had already been obtained.
"Those circumstances clearly don't apply to an interview with the Princess of Wales. It would not have been acceptable to use significant deceit in this case."
On Wednesday night, Kensington Palace was still awaiting clarification from the BBC about whether they – and the Duke of Cambridge – would get sight of the report in advance.
The Duke, 38, is thought likely to comment on its findings when he has had a chance to read the report.
He was the first member of the Royal family to comment on claims that Bashir tricked his mother into giving the Panorama interview, saying last November that he hoped the inquiry would "establish the truth" and describing it as "a step in the right direction".
Bashir rejoined to the BBC in 2016 and was promoted to religion editor.
The BBC announced last Friday he had resigned on grounds of ill health after undergoing a quadruple bypass last year, followed by a further surgical heart procedure recently.
The announcement was made hours before Lord Dyson issued a statement saying his report was completed and handed to Tim Davie, the BBC’s director-general.
Lord Hall, Mr Davie’s predecessor as director-general, is also facing criticism over his role in 1996 in conducting an original investigation into Bashir’s faking of the bank statements. At the time Lord Hall, then head of BBC news, excused Bashir’s "lapse", calling him an "honest and honourable man".
Bashir has declined to comment publicly on the furore, citing his ill health, but is understood to have mounted a vigorous defence at the Dyson inquiry.
Notes from first meeting could shred journalist’s career
The handwritten notes are a piece of history. A record of a first meeting between Princess Diana and Martin Bashir, a then unknown BBC reporter who two months later would conduct an interview with her that would send shockwaves around the world.
The notes – made on Sep 19, 1995, by Earl Spencer, Princess Diana’s brother – have become part of an inquiry by Lord Dyson into claims that Bashir used deceit and trickery to obtain the interview.
Lord Dyson has spent six months combing through the evidence including the notes, passed to him as part of a wider dossier, by Earl Spencer.
The Telegraph has now seen a copy of the notes that detail 38 claims. Each is numbered, although confusingly some are given the same number twice. So although the final note is numbered 32 on the final page of eight pages of notes, there are in fact 38 separate claims in total.
They include extraordinary notations of allegations including (false of course) that Prince Edward had Aids; that phone lines at Princess Diana’s home in Kensington Palace were bugged; and that plans were afoot to destroy the Spencer family.
There’s a suggestion the Queen was unwell. The note states ‘Queen ill: heart’ and adds she “eats for comfort”. That point is numbered 20. The one before it reads: “Fergie gone to US for huge deal today. Andrew looks after her.”
There are other snippets. Like this at point three: “MI6 taped C + Aylard: ‘in end game’ - D told Aylard what she thought of him, + that she wouldn’t divorce.” The C being referred to is Prince Charles and Aylard is Richard Aylard, at the time the Prince of Wales’s private secretary.
The insinuation is clear: that the security services had a taped recording of the Prince and Mr Aylard discussing the end of the marriage to Princess Diana.
Point 12 states: “2 BP staff on moneyed retainers”, seemingly unsubstantiated claims that Buckingham Palace employees were being paid – presumably by tabloid newspapers and possibly by the security services – for information.
Who was paying them was not specified.
Another note claims: “Bugs on car. Senior police officers making money. 3 lines at KP bugged; mail; read; disinformation down line; line on car bugged.”
Point 30 states simply: “D followed twice in car recently.”
Point seven alludes to rumours that had been circulating and subsequently dismissed that Prince Charles was in a relationship with Tiggy Legge-Bourke, nanny to Princes William and Harry.
The meeting between Bashir and Diana, with the Earl present, took place in a flat in a mansion block in Knightsbridge at the home of a woman named ‘Samantha’, who was a long time friend of the Earl’s.
It is reported the meeting took 90 minutes, although The Telegraph understands that Bashir disputed that when questioned by Lord Dyson. Bashir insists the first meeting was brief and only as an introduction to Princess Diana.
He claims many of the smears attributed to him were in fact claims being made by Princess Diana. Bashir has argued that he would never have made such preposterous statements at a first meeting with the Princess. It is unclear what Lord Dyson will have made of his defence.
The notes suggest that Bashir – at that first, crucial meeting – peddled a series of “preposterous lies” to secure his interview, broadcast on Nov 20 1995. Bashir, so it goes, was feeding Princess Diana’s burgeoning paranoia, turning the Princess against loyal friends with lies and mistruths; making her think that Bashir had connections with contacts and sources that reinforced her insecurity.
The notes detail attacks on friends and confidantes; Camilla Parker-Bowles is also referenced. Point 17 states: “Camilla: depressed, but quiet for the time being.”
Earl Spencer was said to be so alarmed by the meeting with Bashir that the pair never met again. He had assumed his sister would have nothing to do with the Panorama journalist either. But he was wrong. With the introduction made, Bashir began a dialogue with Diana that would culminate in the interview.
For years, Earl Spencer kept his notes hidden away but was prompted to unearth his dossier on the 25th anniversary of the interview when new questions began to emerge about Bashir’s methods and claims that BBC executives had covered up his alleged deceit in its aftermath.
In 1996, it emerged that Bashir had ordered bank statements be mocked up showing false payments made to Earl Spencer’s former head of security, falsely claiming he was in the pay of a tabloid newspaper and also an offshore company, the inference being it was linked to the security services.
The payments were false but Bashir, it is alleged, had used them to reel in Earl Spencer and use that as an introduction to Princess Diana.
Lord Dyson has been in possession of the notes for six months. His conclusions about what it all means will emerge in the report published on Thursday.
Bashir has launched a vigorous defence, insisting that the notes represent largely what Princess Diana must have said at the meeting all those years ago, rather than pieces of gossip and intelligence tantalisingly dangled in front of her to gain her trust.
Bashir, now aged 58, made his name with the Panorama interview before leaving first for ITV, then crossing the Atlantic, and landing lucrative jobs with US networks. He rejoined the BBC in 2016 and was promoted to religion editor, but has since resigned.
His reputation is seriously damaged; Lord Dyson’s report may leave it shredded altogether.