When Adam Afriyie sold his political data business, DeHavilland, for £18m, only months after his 2005 election to the House of Commons, it looked as if the fledgling MP had secured a strong financial platform to support his vaulting political ambition.
His 72% stake in the company netted him £13m and one of the Conservative party’s first black MPs – sometimes dubbed the “Tory Barack Obama” – was at one stage reputed to be worth £100m.
Yet this week, HMRC submitted a petition to the high court to have him declared bankrupt over an unpaid bill for at least £1.7m in taxes from his crumbling business empire. Companies House filings suggest that Afriyie’s businesses collapsed owing a total of £2.3m.
Afriyie’s position as an MP, in the safe Windsor constituency he has represented since his political debut, does not appear to be under imminent threat.
But parliamentary rules mean that he would have to stand aside if a bankruptcy restrictions order is made against him. These can be imposed if the bankrupt refuses to cooperate with the process or is suspected of hiding assets, for example.
The taxman’s petition, which Afriyie apparently intends to defend at the high court in person, relates primarily to the liquidation of IT firm Connect Support Services, set up before DeHavilland, the venture whose sale proved so lucrative back in 2005.
Connect Support Services went into insolvency in 2017 and was sold by administrators to fellow IT business Cloud Direct. The Guardian understands that Afriyie expects proceeds from the sale, between £1.5m and £2m, to clear the bulk of his debts to HMRC.
That sale took place in 2017. A liquidator’s report filed at Companies House more than three years later, in November 2020, shows that the company owed £1.8m to HMRC at that time.
Another Afriyie business is in the taxman’s sights too. When Afriyie sold DeHavilland in 2005, he carved out and retained the company’s fast-growing news agency, now called Axonn Media, but known back then as Adfero.
The company was something of a hothouse. Back in 2013, when Afriyie was under scrutiny due to rumours that he intended to challenge David Cameron for leadership of the Conservative party, one former employee lifted the lid on what he alleged was a punishing culture at Adfero.
The former employee, now a Guardian staff member, spoke of being told to produce up to 30 “stories” a day for publication, in an office above a branch of Subway, churning out words on subjects as diverse as double glazing, human resources, conservatories, holidays in Dubai and garden tools.
“The job boiled down to scouring the internet for stories to rewrite such that they were tailored to a client and, most importantly, could include keywords that would boost search engine optimisation,” he said.
Around the same time, Adfero – which had derived its name from the Latin for “I bring news” – rebranded and became Axonn.
Despite its new name, Axonn failed to adapt to the changing world of internet marketing and, from around 2014, began haemorrhaging customers and cutting staff.
The company went into liquidation in 2019 and was sold in July 2019 to T&D Media Group for £39,000 and 6% of sales in the first year. By the time of the liquidator’s next progress report, that 6% was worth just £19,758.76. That indicates annual turnover of less than £330,000 at Axonn, compared with nearly £7.6m in 2013.
That same liquidator’s report, filed in September this year, shows that £492,000 was owed to HMRC.
On Monday, a spokesperson for Afriyie said: “The [bankruptcy] petition arises for complex reasons related to Adam’s past business interests. Negotiations have been ongoing for several years and the petition is subject to legal challenge as his advisers are working towards reaching an agreement.”
The spokesperson declined to offer further comment on Tuesday.