'Adviser' Adam Werritty joined Liam Fox at talks on Iran sanctions

Israeli diplomats say they believed Defence Secretary's best man was his official aide

Senior Israeli diplomats believed that Adam Werritty was an official adviser to the Defence Secretary Liam Fox when the pair attended a top-level conference that discussed sanctions against Iran, The Independent has learned. Mr Werritty organised a dinner during the Herzliya conference in Israel in February this year for politicians and senior officials, which was attended by the Defence Secretary and Matthew Gould, the British ambassador. But he did it without any UK diplomats in the country being involved in the arrangements, it is claimed.

Israeli officials said they were under the impression that Mr Werritty was a senior adviser to Mr Fox and took part extensively in political discussions at Herzliya advocating a tough stance against Iran, a view he had arrived at, he said, after visiting the country.

Mr Fox, in his address to the conference, also raised the need for further sanctions against the Tehran regime. An interim report produced by Ursula Brennan, the most senior civil servant at the Ministry of Defence, revealed that Mr Werritty's presence at a meeting between Mr Fox and Mr Gould, before the latter took up his post in Tel Aviv, was unauthorised.

An Israeli official present at the conference said: "No one had any reason to doubt that Adam Werritty was a senior adviser to Mr Fox. He was very much involved with Mr Fox's schedule, arranging things and it seemed like something he had done many times before."

It also emerged yesterday that Tetra Strategy, a lobbying firm that introduced a client to Mr Werritty, also thought he was Mr Fox's adviser. In a statement, it said: "Tetra introduced its client to Adam Werritty in March 2011, widely believed at the time to be an official adviser to Liam Fox. The purpose of the introduction was to brief the MoD."

In further damaging revelations, it was reported last night that Mr Werritty has been working out of an office belonging to Michael Hintze, a major Tory Party donor and founder of the CQS hedge fund. Another report alleged that Mr Werritty had described his position as "office of Liam Fox" when he booked into the five-star Shangri-La hotel in Dubai, during a trip in which he met with Mr Fox.

The new revelations come as Mr Werritty was interviewed by officials looking into allegations surrounding the links between the two men. Sources close to the inquiry said a conversation between Mr Werritty and Cabinet Office officials took place at an undisclosed location away from Whitehall.

Mr Werritty has had to provide the inquiry with a full list of his business interests and has been asked to detail all his income from defence sources. Mr Fox's political career may depend on whether the inquiry finds that Mr Werritty benefited financially. The Prime Minister's spokesman said: "There is a process under way. The Cabinet Secretary is leading it. He will address the remaining questions people have been asking. The objective is to establish the facts and get the full picture. That is what we will do."

Meanwhile, a senior Tory backbencher warned that the controversy was in danger of becoming a "distraction" for the MoD. Patrick Mercer, a former Army officer, said MoD staff needed to get on with running campaigns in Afghanistan and Libya.