guardian.co.uk,
Rupert Neate, Rajeev Syal and Rob Evans, Friday 14 October 2011
 |
| Liam Fox: the money trail to Adam Werritty's company forced his hand. Photograph: Suzanne Plunkett/Reuters |
By Thursday
evening, even friends of Liam Fox feared he would have to resign after months
of disclosures about his undeclared relationship with his best man, Adam
Werritty.
The final
revelation that appears to have forced the defence secretary to buckle came on
Friday from documents which showed that his self-styled adviser had received
£147,000 from companies which had paid for a jetset lifestyle.
Those who
had paid money to Werrity's company, Pargav Ltd, included a corporate
intelligence company with alleged close links to Sri Lanka, a property investor
who lobbies for Israel and a venture capitalist.
The money,
according to the donors, was supposed to help foster peace initiatives. In the
process, it paid for five-star hotels and first-class travel for Werritty. And
at some of the destinations, he had met Fox in the company of heads of state
and foreign generals.
The
disclosures of a money trail and further undeclared meetings were, it seems, to
prove crucial in the decision by Fox to stand down.
It emerged
on Friday that Werritty was the hidden hand behind Pargav Ltd, a not-for-profit
company. According to the Times, six different financial entities had paid
£147,000 – up to £35,000 each – to the company since October last year. The
entities include Tamares Real Estate, an investment company owned by Poju
Zabludowicz, a Tory donor who is also the chairman of and major donor to Bicom,
an organisation that lobbies on behalf of Israel.
Zabludowicz,
57, who was born in Helsinki and now lives in Hampstead, is one of Britain's
richest men. He has some investments in the arms industry – his father built up
the Israeli arms company Soltam in the 1950s after working closely with Shimon
Peres, who was then the director general of the Israeli defence ministry.
A spokesman
for Zabludowicz said he owned a "legacy" arms business in the US, but
added that it was not a significant part of his empire. Most of his assets were
now in property, he said.
"Any
suggestion that he has benefited from this relationship [with Pargav] would be
completely wrong," he said. "For many years, Poju Zabludowicz has
helped fund not-for-profit organisations, not individuals, due to his passion
for the promotion of peace and understanding between peoples in the United States, Europe and the Middle East."
Another
firm, G3 Good Governance Group, a private intelligence company, made a reported
donation of £15,000 to Pargav, which was intended to go towards charitable
work.
The private
company, which provides advice on risky overseas investments and investigative
services, has attracted little attention from the media until this week. It
styles itself as an "independent strategic advisory firm" offering
"insight, analysis and advice to help leaders make informed decisions and
realise value in complex situations". It says it places the "highest
priority on integrity, discretion and trust".
It operates
out of an undistinguished building in Mayfair and has been chaired by Chester
Crocker, the US assistant secretary of state for African affairs under
President Ronald Reagan, since at least 2005.
With
another office on Madison Avenue in New York and a network spread around the
world, the firm reportedly has 32 analysts.
Interest in
the links between G3 and Fox was aroused earlier this week when it emerged
coincidentally that the Sri Lanka Development Trust was also based at the same
building as G3. The trust was set up by Fox to rebuild the country's
infrastructure using private finance and is now based in Edinburgh. Crocker
refused to comment. One of his allies had told the press that he had no
involvement with Sri Lanka and had not heard of the trust.
Perhaps the
most damaging disclosures showed that many of the financial transactions of
Pargav corresponded with the 18 destinations that Werritty and Fox visited
together over the past 16 months.
Reports
claim that £583.34 left the company's accounts on December 21 to pay The
Palace, a five star resort in Dubai. Ministry of Defence records showed that
Fox was also in the UAE city from December 17 to 22.
Pargav's
finances, according to reports, track Werritty back to Dubai in June, when he
fixed a meeting with Fox for Harvey Boulter, a British businessman.
In Sri
Lanka the following month, the accounts reportedly showed that Werritty
withdrew £117.73 from the Hatton National Bank.
Records at
Companies House show that Werritty is not the director of Pargav, despite being
its only prominent employee. Oliver Hylton, a charity adviser to a hedge fund,
told reporters on Friday that he had signed up as its director after being
asked by Werrity. He said that Werritty was an "adviser of some sort"
to Fox. "Adam is a good and honest man. He has just been making a
living," he said. Hylton added that he had met Werritty through Tory
donors.
Another
reported Pargav sponsor was Michael Lewis, 52, the vice-chairman of Bicom until
2007 and boss of Oceana Investments. A Conservative party donor, he also gave
£13,832 to Atlantic Bridge, the charity set up by Fox and run by Werritty from
Fox's parliamentary office. Lewis donated £5,000 to Fox's leadership campaign
in 2005.
There have
been other intriguing connections between Fox's best man and Bicom, which is
devoted to seeking a more supportive environment for Israel.
It also
paid for Werritty's flight and hotel bills when he attended a conference in
Israel in 2009 to speak about Iran.
Bicom's
former communications chief is Lee Petar, who went left Bicom several years ago
to form Tetra Strategy. Emails seen by the Guardian show that Petar had been
working to arrange a meeting between Boulter, a private equity boss based in
Dubai, and Fox or Werritty since March this year.
Following
this week's media storm surrounding Fox, the donors to Pargav may now be ruing
the day they got involved with Werritty. Jon Moulton, a venture capitalist who
has been listed as making several donations to Pargav, issued a statement
following Fox's resignation claiming that Fox had lobbied him for money on
Pargav's behalf.
"Before
the last election I had made several on-the-record donations to support Dr Fox
following a request to do so from a Conservative party fundraiser.
"After
the election I was asked by Dr Fox to provide funds to a non-profit group
called Pargav involved in security policy analysis and research and after
obtaining written assurances as to its activities I provided personal funding
to Pargav.
"Neither
I, nor any of my associates, have sought or received a benefit of any form from
Pargav. I have not received an account of Pargav's activities, nor have I been
involved at all with Pargav, since funding. I will not be doing this
again," he said.
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