BRITAIN: On a sweaty July afternoon, a notoriously tetchy month at Westminster, the political heart of London, Labour MPs and ministers were astonished to hear that Lord Michael Levy, Tony Blair's one- man cashpoint, had spent most of yesterday under arrest, helping police with their inquiries into the loans-for-coronets affair.
Some jaws dropped. "This is serious," they told each other, making rapid mental calculations about what it might mean for long-promised change of prime ministers if Lord Levy is ever charged. He has certainly been cautioned so that anything he says now may be used in evidence.
Several No 10 Downing Street staffers are believed to have been interviewed, but not arrested or cautioned.
Yesterday's arrest not only took Downing Street by surprise, it caught Lord Levy on the hop. He had told friends he had agreed to go to a London police station yesterday. "He was quite relaxed about it," recalls a former minister, but he did not expect to stay.
He was due to meet Alan Johnson, the education secretary, at 5pm last night, along with the newly knighted Sir Philip Green, the retail billionaire. They were to discuss city academies, fundraising for which is the crucial link between public-spirited charitable donations, party gifts (declared) and loans (undeclared), and the peerage allegations.
Raising money is Lord Levy's game and nobody can doubt he is very good at his job; his rags-to-riches life story is testament to his skill.
Michael Abraham Levy, who celebrated his 62nd birthday this week, was born in Hackney, east London and attended Fleetwood primary school and Hackney Downs grammar school before joining a firm of chartered accountants at the age of 17.
It was thanks to his career as a pop impresario, managing talents as diverse as Alvin Stardust and Chris Rea, that he now lives in an expensive home in Totteridge, north London with white carpets, swimming pool and tennis courts. Here potential Labour donors were wined and dined over lunch and told, so legend has it, that "Tony" might "turn up" for a game - which, to their astonishment, he often did.
Lord Levy is a fast and fluent talker, quick to flatter, adept at persuading dinner guests to open the chequebook they meant to leave at home. By the time he met Mr Blair at an Israeli dinner in 1994, he was a veteran of the north London Jewish charity circuit, the near-perfect man to play tennis with Blair and later to target high-value sympathisers with the fundraiser's mixture of blatant charm and steely persistence.
Lord Levy persuaded the Formula One magnate Bernie Ecclestone to give £1 million to Labour coffers. Despite the controversy that this provoked, his friends say he knows the boundaries and cannot believe that he would cross them. He himself always denies impropriety, saying that any such suggestion prompts a two-word answer, one of which is "off".
Claims on TV that he is Tony Blair's closest confidant may come as a surprise to both men. What is not disputed is that Lord Levy did become a personal Blair envoy in the Middle East because his charm gives him high-level access to both Arabs and Israelis. The flatterer was being flattered, but he was useful too.
Also true is Lord Levy's repeated assertion that he opposed No 10's fatal pre-election policy shift towards soliciting undeclarable loans - a loophole in Labour's own 2000 law which the Tories had already been exploiting. But he went along with it.
Lords Levy, Razzell (his Liberal Democrat equivalent) and Marland (for the Conservatives) recently gave evidence, pretty anodyne by all accounts, to the Commons constitutional affairs select committee. Worse may be in store, but his admirers remain confident that he will see off his investigators - albeit slightly less confidently than 24 hours ago. - (Guardian service)