A document linking Margaret Thatcher to a US corruption probe is so explosive civil servants have been asked to ensure it remains "sealed".

The 79-year-old former Premier is said to have met Congressman Tom DeLay in Britain while he was on a suspected favours-for-freebies scam.

In return for his free holiday, DeLay - who resigned as Republican leader of Congress last week after being accused of laundering political funds - allegedly backed legislation favourable to lobby groups.

Disclosing that US authorities were seeking aid from UK counterparts, a secret Home Office briefing says: "One visit to the UK involved a meeting with Mrs Margaret Thatcher.

"Evidence is sought from her about that meeting and her involvement in the alleged deception and violation of US criminal laws." Police will "sensitively" investigate the meeting, which took place in May 2000.

In return for his free holiday, DeLay - who resigned as Republican leader of Congress last week after being accused of laundering political funds - allegedly backed legislation favourable to lobby groups.

In the dossier headed "Secret...wider circulation strictly forbidden", civil servants then warn ministers: "There would be considerable press interest in this case if it were to become public knowledge

"We have been asked by the US to keep this request 'sealed', which we take to mean as confidential as possible. This has been relayed to the Crown Office and Metropolitan Police

"Our normal line is that we neither confirm nor deny the existence of any request until it is in the public domain and there is no reason to change that course of action here.

The revelations will be a body-blow to Lady Thatcher's reputation and dash Tory morale on the opening day of its crucial party conference

If Lady Thatcher is found to have been involved in the alleged scam she could face a criminal probe in the US or even be banned from travelling to the country

Her spokesman confirmed police had been in contact about the DeLay meeting. But he insisted there was no question of wrongdoing

The document, leaked to the Mirror, informs ministers there has been an official request for "mutual legal assistance" from the US Department of Justice in Washington

It said the request was part of a deception investigation "involving high-profile American and UK-based individuals, including a leading Congressman and former Prime Minister Margaret Thatcher". At the centre of the probe is high-profile lobbyist Jack Abramoff, who is already under investigation in the US

The document says: "US officials are investigating whether Abramoff was involved in obtaining legislative assistance from public officials in exchange for arranging and underwriting trips to the UK.

Investigators are also probing whether the public officials filed false reports relating to the trips

The holidays involved playing golf at St Andrews in Scotland, dinner with unnamed members of the Scottish Parliament, theatre trips in London and luxury hotel accommodation

Mr DeLay's staff also scheduled a meeting with Lady Thatcher

The briefing adds that police investigating the meeting "have been asked to handle these inquiries sensitively given the nature of the individual concerned and the background to the request". Members of the Scottish Parliament will be questioned concerning any contacts they may have had with Abramoff, DeLay or members of their party

Scottish police will collect hotel record, bills, invoices, and statements

Lady Thatcher's spokesman said last night: "An approach was made to her office to confirm the bare details of the particular meeting. At this stage we are expecting nothing further

"Lady Thatcher met Mr DeLay as as one politician meeting another. It was in no way a business meeting.

The Thatcher family's reputation has tarnished since she left office

Her son Mark, 52, was fined £265,000 last year for helping to organise an attempted coup in Equatorial Guinea

There are also growing fears about the health of Lady Thatcher, who is 80 next Thursday

Yesterday she was described as "increasingly forgetful and forbidden to speak in public"

She has had a number of strokes and is said to have been badly shaken by the collapse of her son's marriage

Congressman DeLay, nicknamed The Hammer because of his tough-guy reputation, denies criminal conspiracy relating to party funds

Abramoff insists he is innocent of any wrongdoing concerning millions of dollars in funding he received for helping Indian tribes set up casinos in their tribal homelands

A Home Office spokesman said: "We neither confirm nor deny receipt of requests of legal assistance."

Copyright 2005 The Daily Mirror (UK)

###