Queen Elizabeth II's son Prince Andrew will pay more than £12m ($16.2m) in a pre-trial settlement to American Virginia Giuffre, who accused him of rape, the Daily Telegraph reported the news on Wednesday, citing sources.

On Tuesday, a letter from Prince Andrew's lawyer David Boyce, 61, was published in the US federal court records database for the Southern District of New York, showing that the parties were able to settle the claims in pre-trial proceedings. The letter indicated that the Duke of York would make a contribution to Giuffre, but the amount in question was not named.

According to the newspaper, payments of £12 million will be partly paid by the 95-year-old Queen, who has already privately helped her second son to cover legal costs estimated to be several million pounds. The lawyers were paid from money they receive from the disposal of real estate in the Duchy of Lancaster, which is owned by the monarch: they total about £23 million (more than $30 million) a year. Buckingham Palace hopes Giuffre's payments will draw a line under the scandal, which threatened to overshadow this year's celebration of Elizabeth II's 70th year on the throne.

The newspaper stressed, however, that it would be hard for the Duke of York himself to pay the costs as he lives on the "modest military pension" he receives as a vice-admiral in the British Navy, as well as a £250,000 a year ($340,000) stipend from the Queen. The lawsuit by Giuffre has forced Prince Andrew to put his only asset, a chalet in the Swiss ski resort of Verbier, which he bought in 2014 with a loan and with help of his mother, up for sale.

According to the newspaper's sources, Prince Andrew and Giuffre's lawyers negotiated a pre-trial agreement for 10 days, a deal was reached last weekend. It is noted that the compensation payments are due to be paid into the American woman's account within the next 30 days.