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Liam Fox revelations sap MoD morale

Defence secretary insists 'I carry on' but trust in Adam Werritty rankles with civil servants and military facing redundancy
Guardian

Tory chiefs confess to misleading on Liam Fox
And he 'denies having sex
with pal Adam Werritty'

By TOM NEWTON DUNN, Political Editor Sun

TORY chiefs last night confessed that they DID mislead newsmen about a burglary at Liam Fox's flat.

Liam Fox faces fresh questions on Sri Lanka links

Defence secretary accused of running 'maverick foreign policy' in Sri Lankan Development Trust dealings involving Adam Werritty


Liam Fox faced fresh accusations of running a shadow foreign policy after it emerged he was involved in setting up a private investment firm to operate in Sri Lanka in apparent contravention of UK government policy, with his controversial friend Adam Werritty as its key contact.

The defence secretary was intimately involved in negotiations with the Sri Lankan regime as recently as last summer, according to Lord Bell, his friend of 30 years, agreeing a deal that allows the Sri Lankan Development Trust to operate in the country in the same period in which he now says he withdrew his involvement. The trust was a venture designed to rebuild the country's infrastructure using private finance with a sideline in charitable projects for Tamil communities.

Labour urged the government to come clean on Fox's work in Sri Lanka and whether it might have contravened the government's official policy, while a senior Whitehall source said the minister had been operating a "maverick foreign policy" and it is this that will ultimately decide his political fate.

The government has adopted an arm's-length policy on Sri Lanka, calling for an independent inquiry into alleged war crimes. Since 2006 it has also had a policy to limit development work to urgent humanitarian assistance and "de-mining" areas affected by the civil war.

Fox told the Commons on Monday he had worked with "a number" of business, banking and political contacts to establish the trust in Sri Lanka.

He named only Werritty, his close friend who is at the heart of the scandal over his unofficial role as Fox's adviser. "Neither myself, Mr Werritty nor others sought to receive any share of the profits for assisting the trust," he said.

In June 2010, he met the Sri Lankan foreign minister in Singapore, along with Werritty and MoD officials. "The purpose of the meeting was to make it clear that although I would no longer be able to participate in the project, the others involved would continue to do so," he said on Monday. But Bell told the Guardian on Thursday that discussions took place last summer in which Fox agreed with the governor of the Central Bank of Sri Lanka that the trust would invest in roadbuilding and other infrastructure projects using private investment.

Bell, whose PR firm Bell Pottinger was employed by the Sri Lankan government until last year to improve the country's reputation abroad, said the deal had been struck between Fox and the head of the Sri Lankan bank: "In order for these funds to operate they would need an agreement with the country. The financial interests of Sri Lanka come under the governor of the Central Bank. My understanding is that the infrastructure development fund would be set up and have an agreement with the Sri Lankan government to invest in Tamil communities in Sri Lanka. It's a fine idea with a good sense of purpose."

He added that "of course" part of the strategy was to improve the regime's reputation abroad.

Kevan Jones, shadow defence minister, said: "Liam Fox told the house about the trust on Monday. It's clearly not a full explanation. If he was still striking deals with the Sri Lankans last summer, how does that fit with official UK foreign policy? He has to explain these negotiations. You can't have a situation where a government minister is appearing to run a completely separate foreign policy from that of the government."

Fox's parliamentary and private offices both said last night that Fox ceased to have any involvement with the trust on entering government.

The only activity the Sri Lanka Development Trust appears to have engaged in has been the payment of up to £7,500 of Fox's travel expenses, incurred on three trips to the country in 2009 and 2010.

The trust was originally registered to an address close to the Houses of Parliament in London, 40 George Street, which is also the offices of 3G, the "Good Governance Group", which is chaired by Chester Crocker, a former US politician. He also sits on the board of Bell Pottinger LLC, the US wing of Bell's publicity firm. Bell denied that there was any connection between his firm or its US subsidiary and Fox's Sri Lankan operation.

The trust has since transferred to the Lothian Road in Edinburgh, giving its address as No 50, a substantial granite and glass-fronted office block where a number of firms including the HQ of the Scottish oil exploration firm Cairn Energy and corporate offices for Clydesdale Bank are based. When the Guardian visited the building there was no sign of any physical presence of the organisation.

Two legal firms also based in the building are not believed to be connected. As a legal trust, it does not have to register either with the Charities Commission or on the register of businesses at Companies House. It does not have to publish the names of its trustees, it purpose or its beneficiaries.

Bell said that the trust consisted of two bodies, the Sri Lanka Infrastructure Development Fund, which was intended to raise money abroad from investors who would then share in the profit of ventures on the country, and the Sri Lanka Charitable Fund which would undertake charitable projects in Tamil areas in the north and east.

Inquiries in Colombo could not establish any activity the trust or its subsidiaries have so far carried out. Aid experts, senior politicians and officials in Sri Lanka said they had no knowledge of the trust. Nether the trust nor its subsidiaries are registered by the National Secretariat for Non-Governmental Organisations, a prerequisite for any such project.

On a trip in March 2009, shortly before the end of the bloody but successful government offensive, Fox called for the creation of "a special fund with the help of international partners ... to help the Sri Lankan government in handling the reconstruction and rehabilitation of the war ravaged areas in the north and east [of the country]."

Fox told local journalists he was suggesting "a new, independent, Sri Lanka construction fund". One aim of the fund, he said, would be to divert cash that had been flowing from ethnic Tamils overseas to the LTTE into reconstruction.

No activity on the ground appears to have occurred. "I have my ear pretty close to the ground and I doubt a major new reconstruction project in the north [of Sri Lanka] could get going without my knowledge and I have never heard of this trust," said one senior aid official in Colombo, the commercial capital.

The source of the trust's money for the transport to Sri Lanka for Fox is unknown. Contributions to the cost of the trips were also received from the Sri Lankan government via its London embassy.

Human rights groups have been critical of Fox's outspoken support for the government of President Mahinda Rajapaksa, who is now in his second term of office and has been accused by campaigners of repressing the press and opposition.

WikiLeaks cables revealed American diplomats' concerns at alleged government complicity in human rights abuses committed by troops and paramilitaries during the latter stages of the civil war. The United Nations has repeatedly pressed Sri Lanka for greater accountability and transparency.

Additional reporting: Severin Carrell
Guardian

Liam Fox resigns - live coverage

• Liam Fox quits over links to unofficial adviser Adam Werrity
• Philip Hammond named as replacement defence secretary
GUARDIAN

Liam Fox resignation exposes Tory links to US radical right

Labour and Lib Dem politicians have stepped up demands for the PM to explain ministers' involvement with Atlantic Bridge

Liam Fox and David Cameron, who is being accused of allowing a secret rightwing agenda to flourish within the party.

David Cameron has been accused of allowing a secret rightwing agenda to flourish at the heart of the Conservative party, as fallout from the resignation of Liam Fox exposed its close links with a US network of lobbyists, climate change deniers and defence hawks.

In a sign that Fox's decision to fall on his sword will not mark the end of the furore engulfing the Tories, both Liberal Democrat and Labour politicians stepped up their demands for the prime minister to explain why several senior members of his cabinet were involved in an Anglo-American organisation apparently at odds with his party's environmental commitments and pledge to defend free healthcare.

At the heart of the complex web linking Fox and his friend Adam Werritty to a raft of businessmen, lobbyists and US neocons is the former defence secretary's defunct charity, Atlantic Bridge, which was set up with the purported aim of "strengthening the special relationship" but is now mired in controversy.

An Observer investigation reveals that many of those who sat on the Anglo-American charity's board and its executive council, or were employed on its staff, were lobbyists or lawyers with connections to the defence industry and energy interests. Others included powerful businessmen with defence investments and representatives of the gambling industry.

Fox's organisation, which was wound up last year following a critical Charity Commission report into its activities, formed a partnership with an organisation called the American Legislative Exchange Council. The powerful lobbying organisation, which receives funding from pharmaceutical, weapons and oil interests among others, is heavily funded by the Koch Charitable Foundation whose founder, Charles G Koch, is one of the most generous donors to the Tea Party movement in the US. In recent years, the Tea Party has become a potent populist force in American politics, associated with controversial stances on global warming.

Via a series of foundations, Koch and his brother, David, have also given millions of dollars to global warming sceptics, according to Greenpeace.

Labour said it wanted to know how, in 2006, when David Cameron travelled to Norway for his famous photo opportunity with huskies to promote his new-look party's "green" policies, his senior colleagues were cosying up to US groups that were profoundly sceptical about global warming.

Writing in the Observer, the shadow defence secretary, Jim Murphy, said the Tories still had many questions to answer and claimed that "while David Cameron's compassionate conservatism has been undermined by his actions at home, it could be further damaged by connections overseas".

Murphy writes: "With each passing day there have been fresh allegations of money and influence and it appears that much of the source was the Atlantic Bridge network and its US rightwing connections. We need to know just how far and how deep the links into US politics go. This crisis has discovered traces of a stealth neocon agenda. For many on the right, Atlanticism has become synonymous with a self-defeating, virulent Euroscepticism that is bad for Britain."

Fox resigned on Friday after admitting that he had allowed his friendship with Werritty, a lobbyist who portrayed himself as an adviser to the defence secretary, to blur his professional and personal interests. His resignation followed a drip-feed of revelations about the links between Werritty and businessmen and organisations with defence interests.

The revelations over Atlantic Bridge have triggered questions about the role played by Fox, chair of the charity's advisory council, and that of four of its UK members: William Hague, George Osborne, Chris Grayling and Michael Gove. As a UK charity, the organisation enjoyed tax breaks but had to comply with strict rules prohibiting it from promoting business interests.

The charity's political agenda, which it articulated in conferences devoted to issues such as liberalising the health sector and deregulating the energy markets, chimes with the thinking of many on the right of the Conservative party whom Cameron has been keen to check as he holds the Tories to the centre ground of British politics.

Lib Dem peer Lord Oakeshot said: "Dr Fox is a spider at the centre of a tangled neocon web. A dubious pattern is emerging of donations through front companies. We need to establish whether the British taxpayer was subsidising Fox and his frontbench colleagues. What steps did they take to ensure Atlantic Bridge didn't abuse its charitable status?"

Werritty, the group's UK director, was funded by a raft of powerful businessmen including Michael Hintze, one of the Tories biggest financial backers whose hedge fund, CQS, has investments in companies that have contracts with the Ministry of Defence; Poju Zabludowicz, chairman of the Britain Israel Communications and Research Centre, who chairs a US munitions company; and the Good Governance Group, a private security firm set up by a South African businessman, Andries Pienaar, who also has an investment firm, C5 Capital, focused on the defence sector.

The potentially explosive mix of big business interests and politicians that triggered Fox's demise is the subject of an investigation by the cabinet secretary, Sir Gus O'Donnell. Murphy said it was essential that the government then referred the wider issues to Sir Philip Mawer, the independent adviser on ministers' interests. "He should look at the issues in their entirety to establish precisely how this never happens again," Murphy said.

Questions are being asked over the role played by an organisation called the Sri Lankan Development Trust, whose headquarters were listed at the Good Governance Group. The trust paid for three of Fox's trips to Sri Lanka. In a statement the group said: "Our involvement with the Sri Lankan Development Trust was not done for profit or at the behest of any clients."

Arriving at the Ministry of Defence to take up his new role in charge of the department, Philip Hammond, the new defence secretary, said Fox had "done a great job".
Toby Helm and Jamie Doward, Guardian - comments with this link

Liam Fox's strange tale has been of great comfort in these dark times

There's nothing like a good Tory scandal with a whiff of innuendo, and a defence secretary too dim to realise his fate



Marina Hyde


Liam Fox 'has now been restored to his rightful position in Cameron’s model village'. Photograph: Justin Sutcliffe/eyevine

The question is, when al fresco Cabinet Office minister Oliver Letwin dumps government papers in the park bin, does Adam Werritty sidle along later and fish them out? Who knows at this stage, but it has been a week in which it has become possible to begin enjoying certain aspects of this government. When the grimmest financial unknowns are battering at the door, there is great comfort to be had in sitting back to enjoy a classic old-fashioned defence scandal with a side order of innuendo. Sling another chair leg on the fire, and let's hope that some tear in the scandal continuum will see the bin story collapse into the rather more radioactive buddy movie that is Defence Secretaries Like Us.

Convergence is possible. After all, both Letwin and the newly resigned Liam Fox have starred in one of those idiosyncratic Tory burglaries. Letwin once let a young man into his house to use the loo at five in the morning, only for the little tinker to rob him, causing the then shadow home secretary to pursue him clad in only a bathrobe. It now seems a burglary at Fox's flat last year had elements of the obscure, in that Conservative officials apparently felt moved to conceal from journalists that a man (not Werritty) had been staying in Dr Fox's spare room at the time.

It takes one back, really, this sense that the cabinet are a bunch of chaps with a range of eccentricities and appetites upon which they are conducting a doomed struggle to keep a lid. It somehow has a different quality to the Blair years, where the scandals involved dreary things like passports or visa applications or property deals; or horrors such as the death of David Kelly.

To my mind, there were two unexpungeable black marks against Liam Fox. The first was his fondness for Dubai, a place he and Werritty met five times since the election. I'm afraid the world can be divided into people with whom one would care to spend any time, and people who like Dubai. The second and more alarming black mark was the defence secretary's sensational ineptitude as a strategist.

Dr Fox might have viewed each day's survival as a battle won in his war – as might his allies – but in fact it was the opposite. David Cameron played this perfectly, allowing the darling of the rightwingers to cling on for the full media evisceration. Had Fox resigned on Monday with some huffy but terse statement about having made mistakes and not wanting to distract from the government's vital work, he would have gone to the backbenches bloodied but unbroken, where he would have remained a low-level threat and might even – in the meltdown that may occur when those financial unknowns batter down the door – have seen serious anti-Cameron support coalesce around him. But his insistence on remaining in post allowed the prime minister to watch with a face set to "fair and sympathetic", as an old rival was more irredeemably damaged with each new revelation.

Fox's apparent inability to see that this was what was happening to him was most diverting for the rest of us, though would have been less so had he been defence secretary at the time of the cold war, when rather more first-class game theorists were required. Of course, we had an inkling of the ex-defence secretary's dimness last year, when he felt moved to make a statement saying he was "disgusted and angry" at the "thoroughly un-British" latest edition of the Medal of Honor computer game series, which was set in Afghanistan. According to the MoD, "he wanted to comment on this as it's part of the wider picture of defence". What a mind he is.

I suppose there was a chance the defence secretary might have survived but even if he had, the former GP would have been reduced to the level at which one always sensed the Cameron toffs felt he belonged. To the upper classes, as I wrote in a column about Fox last year, being a GP is almost akin to being a servant. The doctor is certainly not a friend, more someone one has to keep around in case one gets shingles. You give him a middling bottle of whisky at Christmas, and might ask him to make up a bridge four if someone had flu, but you'd have no hesitation in reminding him of his place.

Thus Fox has now been restored to his rightful position in Cameron's model village. It's difficult to decide which was more devastating for him – the vote of confidence from the PM or his having been disowned by Natalie Imbruglia, the erstwhile popstar once romantically "linked" to him in rumours he battled bravely not to stop. "Please!" sniffed Imbruglia at the opening of some envelope this week. "He's a friend of my manager."

Perhaps all that remains in this imbroglio is to see how far the bonds of Fox's remarkable friendship will stretch. Should he find himself forced to make a high-level visit to the dole office, will Mr Werritty be spotted queueing behind him, before whispering stagily to the benefits adviser that he is there "in a private capacity"?
Guardian - comments with this link

Revealed: Fox's best man and his ties to Iran's opposition

An IoS Investigation: The murky world of Adam Werritty: Self-styled adviser 'had links to Mossad'.

By Jane Merrick and James Hanning


Adam Werritty, the man at the centre of the Liam Fox cash-for-access scandal, has been involved in an audacious plot to topple Iranian President Mahmoud Ahmadinejad, it was claimed last night.

The self-styled adviser to Mr Fox, whose close personal friendship with the former defence secretary led to Mr Fox's downfall, has visited Iran on several occasions and met Iranian opposition groups in Washington and London over the past few years, The Independent on Sunday has learnt.

Mr Werritty, 33, has been debriefed by MI6 about his travels and is so highly regarded by the Israeli intelligence service Mossad – who thought he was Mr Fox's chief of staff – that he was able to arrange meetings at the highest levels of the Israeli government, multiple sources have told The IoS.


Mr Fox resigned on Friday after a stream of revelations surrounding his dealings with his adviser, centring on 18 meetings abroad at which Mr Werritty was present, including in Dubai, Sri Lanka and Israel, and 22 at the Ministry of Defence. After vowing to fight the disclosures a week ago, Mr Fox quit the Cabinet on Friday when details emerged of the business and intelligence interests of Mr Werritty's financial backers.

The minister admitted that he had allowed the distinction between his personal interests and government activities had become "blurred". But The IoS has learnt that Mr Werritty's travels went further than the luxury hotels of Colombo and Dubai: he has used his House of Commons-branded business card, which said he was Mr Fox's adviser, to pursue his business interests in conflict-torn South Sudan, other developing African countries and Iraq. The aide has also held talks in London with representatives of the new Libyan government in recent weeks. It is not known whether Mr Fox was present.

The fresh disclosures are likely to form part of Sir Gus O'Donnell's inquiry into Mr Fox and Mr Werritty, which was launched last week as the scandal unfolded. The revelation that the man who had unrestricted access to Mr Fox while he was serving in David Cameron's Cabinet was at the same time attempting to unseat the Iranian President will fuel alarm in the Foreign Office that he was pursuing a freelance foreign policy and acting as a "rogue operator".

At the height of the storm surrounding Mr Fox last week, "friends" of the MP tried to distance him from Mr Werritty by describing him as a "Walter Mitty" figure, to the fury of Mr Fox.

Yet the access to senior government figures Mr Werritty enjoyed across the globe suggests otherwise. Mr Werritty, said one source, worked closely with US-backed neocons who thought they could "bring down Ahmadinejad".

Even though such a plot would be highly ambitious, if not impossible, Mr Werritty's activities fly in the face of the British Government's efforts to pursue a diplomatic solution, through the UN, to Iran's nuclear ambitions.

Mr Werritty joined Mr Fox, while he was shadow defence secretary, on a visit to Iran in the summer of 2007. The IoS understands the adviser has also visited the country on several occasions before and after, although it is not known how long he stayed or whom he met.

Mr Fox is an enthusiastic Atlanticist and is sympathetic to the neocon movement in the United States, which takes a hawkish stance on Iran's nuclear ambitions, although on his 2007 visit to the country he said he hoped for a "diplomatic solution" to the issue. An associate said that Mr Werritty, who can speak some Farsi, would act as a "facilitator" and "take messages" between various opposition figures, although the source insisted he was not a "freelance spy". One diplomatic source suggested that Mr Werritty, once back in London, had been debriefed by MI6 about his travels to Iran. It is not known whether Mr Fox knew the full extent of Mr Werritty's activities, or whether he was merely allowed to continue, and provide information to the British Government on an unofficial basis.

This newspaper has made repeated attempts to contact Mr Werritty but has received no response.

One Whitehall source was scathing of Mr Werritty. The source said: "Ask yourself what he was doing there. It's regime change but only in his own mind. I can't think of anything more stupid, wandering round Iran flying the British flag. Does he really think the answer to Iran's nuclear ambitions – which we all want to resolve – is to have a bunch of people encouraging the opposition there in that way? We do have a responsibility to those people, and anything that's done like that has to have government approval, which he doesn't seem to have had. It's ridiculous. You are inviting people to believe you have the Government's resources behind them, and in fact the opposition is likely to be brutally crushed.

"That is not to say that if he came back to London and he offered to tell MI6 what he had seen while he was in Iran, they wouldn't say 'yes please'. But them picking up as much information as they can, and deniably, is quite different from him being licensed by them."

The IoS has learnt that one senior military figure in a developing country, which this newspaper is not naming to protect his identity, feels he was taken in by Mr Werritty. Last night Labour MP John Mann called on Scotland Yard to launch a fraud inquiry into Mr Werritty and his use of a business card falsely giving his position as an adviser to the former Defence Secretary.

In May 2009, Mr Werritty arranged a meeting in Portcullis House between Mr Fox and an Iranian lobbyist with close links to President Ahmadinejad's regime. In February this year, Mr Werritty arranged a dinner with Mr Fox, Britain's ambassador to Israel, Matthew Gould, and senior political figures – understood to include Israeli intelligence agents – during an Israeli security conference in Herzliya, during which sanctions against Iran were discussed. Despite Mr Werritty having no official MoD capacity, an Israeli source said there was "no question" that Mr Werritty was regarded as anyone other than Mr Fox's chief of staff who was able to fix meetings at the highest levels, and was seen as an "expert on Iran".

The Foreign Office declined last night to comment on any aspect of Mr Werritty's activities .
Independent

Liam Fox scandal: David Cameron is dragged into row on eve of damning report into the former Defence Secretary and Adam

DAVID Cameron has been dragged into the Liam Fox furore as a damn­­ing report on the ex-Defence Secretary and best man Adam

It has emerged that the Prime Minister took flights on a private plane supplied by tycoon Malcolm Scott, who was a prominent supporter of Dr Fox’s charity Atlantic Bridge.

Mr Scott, who has given £1.6million to the Tories and is the party’s treasurer in Scotland, sat on the charity’s advisory council.

The link was revealed as Labour MP John Mann called on disgraced Dr Fox to give up his £17,000 Cabinet pay-off.

Mr Mann said: “It’s outrageous that a shamed and discredited former minister gets such a huge payout.

“It’s for Dr Fox to now take the honourable route and immediately repay this money to the Exchequer.”

On the eve of the publication of Cabinet Secretary Sir Gus O’Donnell’s probe into Mr Werritty and Dr Fox, fears were raised of a cover-up.

The report will say the former Defence Secretary breached the Ministerial Code but that he did not personally profit.

Mr Werritty’s jet-set lifestyle as he travelled the world as Dr Fox’s unofficial adviser was paid for by Atlantic Bridge and a firm called Pargav. But Sir Gus’ probe will not reveal new details about the company – despite Dr Fox’s involvement in approaching City fatcat Jon Moulton for cash – and has not looked at Atlantic Bridge.

The investigation will also ignore Mr Werritty’s alleged links to the Israeli secret service Mossad.

Nor will there be a list of the ministers he met while working side by side with Dr Fox, who was forced to resign on Friday.

Labour says there must be a deeper inquiry, especially after it came to light in Parliament’s Register of Members’ Interests that tycoon Mr Scott laid on planes to take Mr Cameron from Dundee to Oxford in 2009 and from Glasgow to Gatwick in 2008.

A Tory spokesman said: “These donations were entirely unrelated to Atlantic Bridge. All donations to David Cameron’s parliamentary office have been declared correctly in the Register of Members’ Interests.”

But Shadow Defence Secretary Jim Murphy said: “Events have raised questions about David Cameron’s judgment.

“If any of the report’s findings are not published without good reason, or if it is narrow and limited, then people will wonder what the Government has to hide.”

Mirror

Liam Fox, Adam Werritty, and the curious case of Our Man in Tel Aviv

This odd trio met six times - not that the Government wants you to know that, of course. What did they discuss? Did it include Iran? And who exactly is Adam Werritty? Brian Brady investigates a Whitehall mystery which is slowly unravelling Independent

Liam Fox Spent £184,000 On Flights For Private Office Staff And Special Advisors In Just 15 Months www.huffingtonpost.co.uk

Cameron's 'Independent' Adviser On Ministerial Code Not So Independent Huffington post