Fox's position precarious after new revelations

Adam Werritty, whose relationship with Liam Fox is at the centre of a political storm and the subject of a government inquiry to be presented to the Prime Minister today, personally helped to organise a controversial visit to Sri Lanka by the Defence Secretary, i has been told.

During a trip in December 2010, Mr Werritty, the best man at Mr Fox's wedding and a former flatmate who holds no official post, met Sri Lankan leaders while describing himself, it is claimed, as an aide and adviser to the UK minister. Mr Fox, pictured, had been due to join him but cancelled his trip after protests from the Foreign Secretary, William Hague, and pressure from Downing Street. At the time, the Sri Lankan government was being accused of committing war crimes during the civil war against Tamil separatists.

But the arrangements made by Mr Werritty, and subsequent work by him, are said to have paved the way for the Defence Secretary's official visit to the island three months ago.

In a statement last night, Mr Fox appeared to admit for the first time that Mr Werritty gained financially from defence industry business. Apologising for allowing "distinctions to be blurred between my professional responsibilities and my personal loyalties", Mr Fox said: "I accept that, given Mr Werritty's defence-related business interests, my frequent contacts with him may have given an impression of wrongdoing, and may also have given third parties the misleading impression that Mr Werritty was an official adviser rather than simply a friend."

Today, Gus O'Donnell, the Cabinet Secretary, will present the Prime Minister with the interim findings of the Ministry of Defence's inquiry into the affair. As well as meeting the Sri Lankan President, Mahinda Rajapaksa, alongside the Defence Secretary during the President's visit to the UK, Mr Werritty accompanied Mr Fox to a meeting in Dubai in which security contracts were discussed.

Mr Werritty had been distributing cards describing himself as "an adviser to the Rt Hon Dr Fox MP" and, according to Sri Lankan officials, it was in this capacity that he held meetings with ministers in Colombo last year. Yesterday, a Sri Lankan official said: "Adam Werritty was definitely the adviser of Liam Fox. He [Mr Werritty] had full authority to make arrangements on his behalf; that is what he told us when he arrived here in December."