The consultancy co-founded by Peter Mandelson has collapsed into administration, after a number of clients cut ties with the company over the former ambassador’s relationship with the convicted child sex offender Jeffrey Epstein.

Global Counsel, which Mandelson co-founded in 2010, said on Friday that it had stopped trading and its staff in the UK were being made redundant.

The London-based company employs about 100 people, the vast majority of whom are based in the UK. It also has employees in Berlin, Brussels, Doha and Singapore.

Administrators at Interpath said Global Counsel had “no option” but to enter administration after a number of its clients cut ties with the business, despite its attempts to distance itself from Mandelson and its other co-founder, Benjamin Wegg-Prosser.

The crisis hit Global Counsel after it emerged that Mandelson had sought Epstein’s advice on setting up the business in 2010, shortly after leaving office when Labour lost the general election.

Will Wright, the chief executive of Interpath and joint administrator, said on Friday: “While Global Counsel had grown over the past 15 years to become one of the UK’s leading public affairs consultancies, the rapid and sudden loss of clients over recent weeks has had a monumental impact on the business.

“We will now undertake a detailed review of the company’s assets and liabilities and explore the best route to realise the company’s assets.”

Interpath added that the immediate focus would be on supporting staff in the UK.

Wegg-Prosser stepped down as chief executive earlier this month.

Files released by the US Department of Justice showed that Wegg-Prosser had met Epstein and shared the company’s business plan while Epstein was under house arrest in New York.

Global Counsel was approached for comment.