The Duke of York is preparing to give formal evidence to a US criminal investigation into the disgraced paedophile Jeffrey Epstein, The Telegraph can disclose.

In an unprecedented move, the Duke announced on Wednesday evening that he was stepping back from public life in the wake of a BBC interview over his friendship with Epstein that backfired in spectacular fashion.

A well-placed royal source said on Wednesday night that the Queen had summoned the Duke to Buckingham Palace to effectively sack her second-born son – said to be her favourite child – from official duties, ordering him to stand aside. The Prince of Wales, who is on a tour of New Zealand, was consulted by telephone.

City sponsors deserted the Duke’s flagship projects while major charities were planning to ditch him as their patron. A planned visit to flood victims in South Yorkshire were abandoned in the aftermath of his “excruciating” Newsnight performance.

Buckingham Palace is understood to be braced for US authorities to issue the Duke with a subpoena, requesting he gives testimony under oath over his friendship with Epstein. Sources have suggested the summons is “imminent”.

Prince Andrew, 59, accepted in a statement issued last night that his association with Epstein, a convicted sex offender who killed himself in August, “had become a major disruption to my family’s work”. He added he had asked the Queen for permission to give up his work and that she had consented.

He also said for the first time that he would fully cooperate with US law enforcement agencies investigating co-conspirators who helped to traffic under-age girls for Epstein and others.

The Duke’s decision to quit came four days after he gave the 50-minute interview to the BBC’s Emily Maitlis. He had hoped the interview would draw a line under his friendship with Epstein and the claims that he had sex three times with Virginia Roberts Giuffre, a 17-year-old who had been one of the billionaire’s “sex slaves” in 2001.

The Duke vehemently denies he had sex with Ms Giuffre and says he has no recollection of ever meeting her.

Instead, his failure to show sympathy for Epstein’s victims and his description of the paedophile’s predatory sexual behaviour as a “manner unbecoming” provoked outrage and scorn.

Prince Andrew smiling as he stands with his left arm around the waist of Virginia Roberts. It is alleged to have been taken in early 2001. Ghislaine Maxwell stands behind. credit: AKGS

In the Newsnight interview he had said only that “if push came to shove and the legal advice was to do so” would he be willing to give testimony under oath to US authorities.

Buckingham Palace declined to comment on suggestions a subpoena was imminent.

Within minutes of the statement being issued at 5.52pm yesterday, the Queen was undertaking her first public engagement since the scandal broke to give a prestigious award to Sir David Attenborough and the Blue Planet II team for their work in raising awareness of plastic pollution.

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The future of Amanda Thirsk, the Duke’s loyal private secretary who had set up the Newsnight interview, remained in doubt last night, although she was still working in his private office. Ms Thirsk was under pressure to resign and nevertheless may no longer have a role anyway, given the Duke is quitting his public duties. A Palace spokesman said: “We don’t comment on individual members of staff.”

A well-placed royal source said it had been the Queen’s decision to force her son to step back from public life. The source said: “The Duke was summoned from his home Royal Lodge Windsor to see the Queen personally at Buckingham Palace. Effectively he was told to bow out gracefully. They agreed he could release a statement saying it was his decision but it was the Queen who told him to do it.” The decision coincided with the Queen’s 72nd wedding anniversary yesterday.

Prince Andrew smiling as he stands with his left arm around the waist of Virginia Roberts. It is alleged to have been taken in early 2001. Ghislaine Maxwell stands behind. credit: Jae Donnelly

His withdrawal from public life will mean almost 200 charities and organisations that have his backing will no longer receive his patronage “for the foreseeable future”, say Palace sources.

The sources refused to be drawn on how permanent his effective exile would last although he will continue to attend landmark events such as Trooping the Colour and Remembrance Sunday as “a member of the Royal family”.

Aides said that if the Duke’s individual charities wished to replace him as patron during his absence “that would be a matter for them”. Many are likely to seek alternative figureheads.

The Duke of York, speaking for the first time about his links to Jeffrey Epstein in an interview with BBC Newsnight's Emily Maitlis. credit: BBC /Mark Harrison

The next big outing for the Duke comes in the spring when Princess Beatrice, his eldest daughter, is to marry.

The Duke had become friends with Epstein in the late Nineties through his long-standing relationship with Ghislaine Maxwell, the daughter of the disgraced media tycoon Robert Maxwell.

David Attenborough sits next to Britain's Queen Elizabeth during the annual Chatham House award in London on Wednesday credit: Simon Dawson /Reuters

He had previously been forced to resign as a UK trade envoy in 2011 after a photograph emerged of the Duke meeting Epstein in Central Park, New York, shortly after the billionaire had been freed from jail after serving an 18-month sentence for sex offences.

The Queen and Prince Andrew in August credit: Duncan McGlynn

The announcement that he was stepping down from public life came after major sponsors of his flagship entrepreneurial schemes made clear they would no longer back the Duke’s projects while he was at the helm. BT said that it could no longer sponsor iDEA, a scheme helping young people in the workplace.

BT said before the Duke’s statement: “In light of recent developments we are reviewing our relationship with the organisation and hope that we might be able to work further with them, in the event of a change in their patronage.”

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Barclays became the latest big company to express its concerns on Wednesday. In a statement, Barclays said: “Pitch@Palace as an organisation has made an undeniable impact on supporting entrepreneurs and creating new jobs which is why we are keen to support the programme. However, we are concerned about the current situation and are keeping our position under review.”

Christopher Wilson, a Royal biographer, said last night: “The resignation from public duties has not come before time. The damage he has done to the Royal family will take years to repair.”

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