The Prince of Wales is to pay £50,000 to an Oxford woman who claimed she was sexually harassed by one of his senior aides.

Former Royal secretary Juliet Franks, whose family home is in Five Mile Drive, north Oxford, resigned in March after making a complaint against Nick Archer, the Prince's assistant private secretary.

The £50,000 settlement, agreed after an independent investigation, will prevent the need for an industrial tribunal - where Prince Charles could have been called to give evidence.

Miss Franks, 28, a former pupil at Headington Girls School, had worked in the Prince's office for seven years before withdrawing from his tour of the Falklands earlier this year due to illness. She later resigned, accusing Mr Archer, her boss for two years, of sexual and mental harassment.

Mr Archer, 38, a career diplomat and one of Charles's closest advisers, has vehemently denied any wrong-doing.

Miss Franks was said to be unhappy with the way officials handled her complaint, and consulted lawyers about bringing a legal case for constructive dismissal.

According to sources, Miss Franks, who is single, enjoyed a "cordial, almost flirtatious" relationship with Mr Archer. It is understood she first made allegations against him shortly after he announced his engagement to barrister Erica Power in The Times at the end of January.

Officials at St James's Palace were said to be anxious to avoid a public airing of grievances and confidential matters at an industrial tribunal and ordered an independent inquiry. The financial settlement resolves matters without attaching blame or suggesting liability. The £50,000 bill is expected to be met by the Foreign Office.

Mr Archer will not be disciplined over the allegations but is expected to leave the Prince's circle and return to his job at the Foreign Office.

There was no sign of Miss Franks at either her West London flat or her parents home in Oxford yesterday. Her mother Katharine Franks said: "There will be no comment."

Story date: Monday 10 May

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