Liam Fox
Liam Fox resigned after nine days of newspaper allegations REUTERS

Liam Fox has resigned from his post of Secretary of Defence.

He handed in his notice following a week of speculation surrounding the relationship with his friend Adam Werritty who had been posing as Fox's advisor on official state visits - 18 times overseas and 22 times at the MoD since taking office 16 months ago.

Upon leaving office he said that he had: "Mistakenly allowed to let his personal and professional life to become blurred."

The prime minister, David Cameron, has said he was "very sorry" about the resignation, but understood why the decision had been taken.

A stream of news stories about Fox and his former flat-mate and best man Adam Werritty, who met frequently with Fox and falsely identified himself as his adviser, had eroded Fox's credibility ahead of an inquiry into the affair that was due to be published within days.

Damaging Newspaper Articles

Newspaper articles have printed varying allegations about Dr Fox all week and fuelled speculation that the Secretary of State couldn't hold onto his job much longer.

The Telegraph said yesterday that Werritty fitted the bill of a person looking to live the high life on the coat tails of others. Friends described him as a "Walter Mitty figure" who took advantage of the defence minister's friendship.

Perhaps the most damaging of all articles, however, came this morning when The Times received details of the Pargav accounts which revealed how and who paid for Werritty to live the "jet-set lifestyle" with Fox.

Mr Fox was being investigated by the Cabinet Secretary amid claims that he had broken the ministerial code.

In his resignation letter, Mr Fox said he had "mistakenly allowed the distinction between my personal interest and my government activities to become blurred".

"The consequences of this have become clearer in recent days," he added. "I am very sorry for this.

"I have also repeatedly said that the national interest must always come before personal interest.

"I now have to hold myself to my own standard. I have therefore decided, with great sadness, to resign from my post as secretary of state for defence."

Mr Fox apologised to MPs earlier this week but maintained that there was no wrongdoing in his dealings with Mr Werritty.

Bad judgement

Liam Fox's judgement had been called into serious question, as it revealed that not only was he using a personal friend as a foreign policy representative, but also the use a non-profit company to fund a lavish private lifestyle.

A syndicate of investors including a corporate intelligence company with close interest in Sri Lanka, a property mogul who lobbies for Israel and a venture capitalist with strong ties to Washington all made donations to fund Werritty's much publicised trips.

The donors have since stated that their contributions were not intended to be used for such a cause.

The trio made investments into an account, set up by Werritty, under the non-for-profit company Pargav who used the cash to pay for hotels in Dubai and Sri Lanka at the same time Liam Fox was also there on state duty.