Princess Eugenie was holidaying in the exclusive Swiss ski resort of Gstaad with her family as her father Andrew Mountbatten-Windsor was arrested, it was revealed today.
Andrew's youngest daughter, 35, is said to be 'in a state' after her father was held on suspicion of misconduct in public office during a raid on his new Sandringham home on Thursday.
But before the arrest of her father, who was already reported to nine different police forces, she popped up on an expensive ski trip during half term this week.
Her parents feature heavily in the Epstein Files and Sarah Ferguson's emails to the convicted paedophile revealed she took Eugenie and Beatrice to visit him days after his release from prison for child prostitution offences.
Fergie even spoke to Epstein about Eugenie's sex life and boyfriends.
So diners at an expensive restaurant in Gstaad admitted they were shocked to see her out and about in such a public place given the scandal engulfing her family.
One who saw them said: 'I was surprised to see her because I thought she would be keeping a low-profile in light of everything that has been going on'.
Eugenie was spotted in the Swiss Alps with her husband Jack Brooksbank, their sons August and Ernest and their nanny perusing the menu at a restaurant famed for potato rosti and Viennese sausage on Wednesday
The Brooksbanks were with friends who had also joined them at the eaterie with a large terrace with views of the Alps, although witnesses said they opted to stay inside.
Eugenie, pictured on a previous ski holiday with son Ernest last winter, has been spotted in the Swiss Alps as her father was arrested
Her husband Jack, also pictured with Ernie on a previous trip, was also there with their two children and the nanny
Eugenie is pictured with friend Caroline Daur, 30, working at an art fair in Qatar last week
They added in an interview with Hello!: 'Eugenie and Jack were with the children, the nanny and a group of friends.
'They were tucked away in a corner and casually dressed in ski gear and jackets, and Jack was wearing a beanie hat as they both browsed the menu.'
It came after Eugenie was seen working in Doha at an art fair last week amid reports her mother Sarah Ferguson had joined her on the trip to the UAE.
Beatrice has not been seen at all in recent weeks.
Fergie is in a 'bad way' and feels that 'everyone is out to get her', her friends have admitted following ex-husband's arrest.
The former Duchess of York, 66, who has not been seen in public for five months, may now look to the UAE for cash and abandon her dream of a new home in Windsor to be near Beatrice and Eugenie.
But she is said to have told friends that there will be no tell-all book detailing the family's ties to paedophile Jeffrey Epstein, though she 'might end up having to tell that story to the police'.
This week it emerged that six of Sarah Ferguson's companies are being wound down over the next ten days.
Princesses Beatrice and Eugenie have also been said to be 'in a state' following their father's arrest on suspicion of misconduct in public office.
The shamed former royal spent 11 hours in police custody on his 66th birthday yesterday after plain-clothed officers swooped on his Wood Farm residence in an 8am raid.
Police were spotted attending the Norfolk home again shortly after 6am this morning, while vehicles have also been seen arriving at Royal Lodge.
However, there has so far been no word from Fergie or her daughters, and questions have been mounting over their whereabouts.
A royal source told the Daily Mail: 'I've been talking to some of her friends. She sounds in a bad way. She's been telling people she is really suffering with her mental health and thinks everyone is out to get her.
Fergie was last seen in public being driven out of Royal Lodge on September 25 last year
Andrew is pictured leaving Aylsham police station in Norfolk shortly after 7pm on Thursday
'But at the same time she is adamant that she wants to get out there and start earning money again. I can't see how she's going to do it. Her brand is toxic.
'Her best hope of a money-spinner is a tell-all book about how her family's friendship with Epstein has destroyed everything and left the monarchy in crisis - but she's ruled that out apparently.
'Besides she might end up having to tell that story to the police and a judge and jury or to some other form of inquiry'.
A royal source said Fergie would prefer Windsor as a base – but the UAE may appeal because she needs to make money.
'I think she'd like to stay in the Windsor area to make it relatively easy for Beatrice and Eugenie to visit with her grandchildren.
'But I can see the arguments for basing herself in the Gulf if she really thinks she can still make money'.
The insider added that while she is said to have ruled out moving in with Andrew in Sandringham: 'I'm not sure why a five-bedroom farmhouse in Norfolk would be so bad'.
Andrew was released under investigation and was pictured cowering in the back of a car as he left Aylsham police station shortly after 7pm last night.
It is understood his arrest was in relation to allegations he passed sensitive information to Epstein while acting as a trade envoy for the British government.
Searches are being carried out at addresses in Berkshire and Norfolk, Thames Valley Police have said.
But Andrew's dramatic arrest comes in stark contrast to Fergie, who has not been seen in public since September 25 last year, when she was photographer being driven out of Royal Lodge.
Until recently, the disgraced pair - who Fergie once described as the 'happiest divorced couple in the world' - continued to live together at Andrew's vast Windsor mansion, a staggering three decades after their split.
She is recently said to have spent time with friends in the French Alps before moving on to the United Arab Emirates.
She has also been spending time with her youngest daughter, Eugenie, 35, who has been in the region for work, attending an art fair in Doha, Qatar, in her role as a director at dealer Hauser and Wirth.
The ex-duchess has tried to keep a low profile after emails between herself and Epstein show her repeatedly chasing him for money to pay off her debts, as well as practical support over a considerable period of time.
The latest cache of Epstein Files has revealed that the paedophile had secretly bankrolled Fergie for 15 years.
In an email from Epstein, he said he began 'financially supporting' the former Duchess of York in 1996 - the year she divorced Andrew.
Epstein's email suggested his financial patronage of Fergie went way beyond the £15,000 she publicly admitted taking from him.
It was also previously uncovered how she remained in close contact with the paeodphile after he was released from prison for sex offences against children.
She had even taken her two daughters to have lunch with Epstein five days after his release.
She also privately issued a grovelling apology to Epstein for publicly denouncing him, claiming she had done so only to protect her career as a children's author.
She told him he had been a 'steadfast, generous and supreme friend'.
Royal commentator Richard Fitzwilliams told the Daily Mail yesterday: 'Sarah Ferguson has no future at all. She's shamed and her businesses are closed down, and certainly no charity would touch her and a great deal more will come out. We're not at the end.
'A little quiet and humility would be a good idea but it's not in her temperament. This is very serious and you never know where it could go.
'She should be extremely concerned about what has come out.'
Speaking on Andrew's arrest, Mr Fitzwilliams added: 'It is an unprecedented crisis, particularly because it has been allowed to go on for so long.
'It will cause enormous concern at the Palace.'
Andrew, the former Duke of York is the first senior royal to be arrested in modern times - with Thursday no doubt one of the worst days for the Crown in recent history.
Andrew's brother King Charles III was not given any prior warning of the arrest, although the Daily Mail revealed Home Secretary Shabana Mahmood's team was informed by a senior officer early on Thursday.
However, King Charles gave police his 'wholehearted support and co-operation' after his brother was arrested.
'I have learned with the deepest concern the news about Andrew Mountbatten-Windsor and suspicion of misconduct in public office,' the monarch said.
'What now follows is the full, fair and proper process by which this issue is investigated in the appropriate manner and by the appropriate authorities. In this, as I have said before, they have our full and wholehearted support and co-operation.
'Let me state clearly: the law must take its course.
'As this process continues, it would not be right for me to comment further on this matter. Meanwhile, my family and I will continue in our duty and service to you all'.
The Prince and Princess of Wales are understood to support the King's statement.
A spokesman for Thames Valley Police said yesterday: 'As part of the investigation, we have today arrested a man in his sixties from Norfolk on suspicion of misconduct in public office and are carrying out searches at addresses in Berkshire and Norfolk.
'The man remains in police custody at this time.
'We will not be naming the arrested man, as per national guidance. Please also remember that this case is now active so care should be taken with any publication to avoid being in contempt of court.'
Assistant Chief Constable Oliver Wright said: 'Following a thorough assessment, we have now opened an investigation into this allegation of misconduct in public office.
'It is important that we protect the integrity and objectivity of our investigation as we work with our partners to investigate this alleged offence.
'We understand the significant public interest in this case, and we will provide updates at the appropriate time.'
