Prince Andrew used his royal position to demand a special briefing from the Serious Fraud Office weeks before launching a tirade against the agency's "idiotic" investigators at a lunch with businessmen in Kyrgyzstan.

The prince, who is also a UK trade ambassador, was briefed on the investigation into allegations of bribery by arms firm BAE at Buckingham Palace in May 2008.

Soon after, believing he was speaking in private to a group of sympathetic British businessmen, he appeared to condone bribery, and scorned the work of the SFO's anti-corruption investigators in investigating the Saudi royal family.

Andrew's remarks , which have already led to calls for his resignation as the official British trade envoy to the Middle East and Asia, emerged this week when the Guardian published a leaked diplomatic cable from the US ambassador who was also present at the event.

Andrew's remarks were condemned by Vince Cable, the business secretary. Cable said it "was not helpful" for the Duke of York to comment on policy.

"I would just make it absolutely clear that we regard bribery overseas as illegal and unacceptable," he said. "That is not a matter for Prince Andrew; that's a matter for the government."

Two senior SFO sources confirmed that BAE case-handlers had protested in strong terms at the time at the request for a briefing by Prince Andrew, and insisted that he only be given publicly-available information. "They all thought the request was well out of order," one said. They felt "very uncomfortable".

At the time, the SFO was coming under intense pressure from Saudi and UK arms company lobbying. The anti-corruption agency were forced to suspend their Saudi investigation by Tony Blair, then prime minister, who said it jeopardised crucial intelligence sharing relationship with the Arab state.

At the time Saudi royals were intensely sensitive about the investigation into secret payments from the British firm .

The head of the SFO, Richard Alderman was summoned to Buckingham Palace shortly afterwards, on the morning of 13 May 2008, according to a palace spokesman.

Asked if Andrew had discussed the BAE case at that meeting, the spokesman said: "I would be surprised if he didn't." But he said: "The director of the SFO didn't report to him anything other than publicly available information."

After his return from Kyrgyzstan, Andrew accepted an invitation to tour the SFO's headquarters in Elm Street, London on 9 December 2008.

According to the palace, he again discussed the state of the BAE case, which was still probing secret alleged payments to clinch arms deals in several other countries.

Yesterday, the Guardian reported how US ambassador Tatiana Gfoeller reported back to Washington on her shocking encounter with the British royal in Kyrgyzstan: "Rude language à la British … [Andrew] turned to the general issue of promoting British economic interests abroad. He railed at British anticorruption investigators, who had had the 'idiocy' of almost scuttling the al-Yamama deal with Saudi Arabia."

The SFO said of its dealings with Andrew: "No confidential details were given over."

One senior former diplomat said : "The coverage has been a bit unfair. He is a twat, but [on the Saudi BAE bribery case] he's right in the wrong way. The Saudis would have ended counter-terrorism cooperation with us completely, and that is absolutely vital.

"But Andrew is an idiot and puts it crudely, and it was wrong to suggest the bribery was acceptable."

The former diplomat said the prince was "a net asset to Britain" adding: "Built in the price is the fact he does speak his mind, and he does have a short fuse. But he gets on with the Saudis, who like a prince."

Anti-corruption campaigners called on Andrew to resign as a special UK trade representative. Kaye Stearman of the Campaign Against the Arms Trade, said: "It is wrong … that Prince Andrew is seen to be supporting arms sales and accepting corruption. This report shows that the relationship seems to go even deeper, with Prince Andrew speaking out against a government agency attempting to investigate corruption and arms deals."

Andrew Feinstein, an anti-corruption campaigner and former South African MP who resigned in protest over BAE bribery allegations, said: "I am amazed but not entirely surprised by the prince's comments. The royal family has actively supported Britain's arms sales, even when corruption and malfeasance has been suspected.

"For instance, the royal family was involved in trying to persuade South Africa to buy BAE's Hawk jets, despite the air force not wanting the planes that cost two and a half times the price of their preferred aircraft. As an ANC MP at the time, I was told that £116m in bribes had been paid to key decision-makers and the ANC itself. The royal family's attitude is part of the reason that BAE will never face justice in the UK for its corrupt practices."