Cherie admits conman's help in flat deals

The prime minister's wife, Cherie Blair, today conceded that the convicted fraudster Peter Foster had indeed helped broker the purchase of property in Bristol, where the Blairs' eldest son is studying.

Her comments, made in a statement issued by the Downing Street press office, undermine a string of denials from aides to the prime minister. They have claimed for several days that Foster did not give advise on the purchase.

Mrs Blair said that Foster, who is wanted in Australia over an alleged fraud and who has been convicted of a fraudulent business deal in Britain, mediated in the purchase of the flats "for a couple of weeks".

In an attempt to bring an end to a string of embarrassing front page articles, Mrs Blair said that if she had caused "any misunderstanding between the No 10 press office and the media that is unfortunate and I regret that".

The statement followed the publication in the Daily Mail this morning of email correspondence with Foster that appeared to prove he brokered the deal and saved Mrs Blair several thousand pounds in so doing.

In the emails, Foster also offered Mrs Blair the services of his own accountant to arrange a mortgage, found a letting agent to rent out the property and persuaded the agent to reduce his normal fee.

Media interest in the story grew following reports in the Mail on Sunday, which claimed that the Blairs had sought to evade paying stamp duty on the property and had used their position to secure a reduction of ?26,000 on the selling price.

The Downing Street rebuttal unit went into overdrive, briefing against the story.

Mrs Blair continues to insist that Foster did not act as her financial adviser.

However, her statement says that "he helped me by talking to the property agents, making suggestions to me about the best price to secure and corresponding with me by email".

It adds that "for reasons of avoiding publicity and because of work commitments", she had asked her friend, Carole Caplin, to look at the property. Ms Caplin went with her boyfriend, Foster.

"I had, at that point, never met Mr Foster or spoken to him and was unaware of the details of his past which has since become public. Clearly had I been aware I would have been far more circumspect in my response to what appeared to be straight forward, friendly offers of assistance from the boyfriend of a friend," the statement says.

Foster, a former boyfriend of page-three model Samatha Fox, was sentenced to 33 months in jail in September 2000 for using fraudulent documents to help him obtain credit to launch a slimming pill.

Mrs Blair is adamant that she did nothing wrong in the purchase of property in Bristol, where the Blairs' eldest son Euan is attending university.

And Downing Street continues to argue that it did not lie to the press.

"Did we know the detail as outlined in Mrs Blair's statement? No," the prime minister's official spokesman said. "Was it a deliberate attempt to mislead the press? Answer: No."