The Mail on Sunday

Panic after foreign aid firm collapses

War zone embassies refuse pleas for help from besieged staff

- By Michael Powell

THEY were handed tens of millions of pounds of British taxpayers’ money to deliver vital overseas projects for the Foreign Office and help bring stability to some of the world’s most volatile war-torn nations.

But two former UK diplomats were last night accused of causing ‘huge damage’ to Britain’s reputation across the Middle East and Africa after their firm Aktis Strategy collapsed, leaving hundreds of employees and suppliers in thirdworld countries to face massive debts.

Staff working in conflict zones have accused British embassies of ignoring their pleas for help as they are hounded by local businesses owed hundreds of thousands of pounds. Some former employees have been made homeless as a result.

Yet founders Dr Andrew Rathmell and Alex Martin – whose time at the Foreign Office helped to secure major UK Government contracts – appear to have escaped unscathed. An investigat­ion by The Mail on Sunday can reveal:

British embassies have refused requests by desperate Aktis staff to settle bills owed to firms across the Middle East and Africa;

More than 80 ex-staff are owed thousands in unpaid wages and pension contributi­ons;

The wife of Britain’s ambassador in Iraq quit her senior role with Aktis because she ‘saw the writing on the wall’;

The ‘penny pinching’ firm is accused of failing to pay for security teams or health insurance for some field workers in conflict zones;

Bosses blew a six-figure sum on a champagnef­uelled ‘retreat’ for staff.

One former senior staffer said: ‘The directors of Aktis have left their own staff high and dry and the debts to suppliers are eye-watering in places like Iraq. If it is not sorted out soon I fear that people will be killed over this. This is all hugely damaging for Britain’s reputation.’

A project co-ordinator in Erbil, Iraq, said she was being chased for more than £350,000 owed to suppliers. ‘It is a scary situation. I just don’t know how we are going to get the money back.’

Another Aktis source said: ‘People are getting desperate.’

The MoS has seen an email exchange between an Akt is employee and the British embassy in Iraq pleading for help to pay off angry businessme­n chasing them for money. The reply from a UK embassy official reads: ‘The FCO ( Forei gn a nd Commonweal­th Office) has paid Aktis for work delivered in line with our contractua­l obligation­s.

‘The requiremen­t to pay sub-contractor­s and staff rests with Aktis and we would therefore encourage you to speak to Aktis directly.’

Aktis was founded in 2013 by Rathmell and Martin. Insiders say the firm expanded rapidly before suddenly running into difficulty in the summer of last year and ‘imploding’ on March 14. Before its collapse, it had landed major contracts for Foreign Office projects in 25 countries including Iraq, Syria, Somalia, Libya and Afghanista­n.

Last year, the FCO paid Aktis £24 million. Some of its work is in training security chiefs and police forces as countries rebuild after years of war. But former staff say it is they who need protection.

One ex-manager said: ‘You can’t just run a company into the ground like this, recklessly or otherwise, and walk away like nothing has happened, skipping off into the sunset. People’s lives have been ruined.’ It is a far cry from the autumn of 2017, when the firm splashed out more than £100,000 on a ‘boozy’ three-day retreat for staff.

The company continued to expand last year, but employees say their salaries began arriving late or only in part. Some bills for hotels and security personnel on missions abroad went unpaid. Patricia Haslach, a former US ambassador

‘I fear that people will be killed over this’

and the wife of Jon Wilks, the British ambassador to Iraq, started working at Aktis last July as head of conflict management. But she quit i n November a nd last ni ght explained: ‘I could see the writing on the wall. I was having to tell people they were not going to get paid on time, it just didn’t look good.’

Bailiffs arrived at the firm’s London HQ in January and told staff to work from home. On March 14, the firm announced it had gone into administra­tion. ‘People are devastated,’ said one former employee. ‘The Foreign Office never stopped paying its bills on time, so the question is: where did all the money go?’

Indeed, FCO records show Aktis Strategy received almost £2 million in the last three months of trading. As recently as February, the department paid it almost £800,000. Last night, the Foreign Office confirmed that it ‘had a small number of contracts with Aktis Strategy Ltd which have now ended’.

In a statement, Rathmell and Martin blamed the company’s demise on ‘ weaknesses in its financial management and in the financial management team’.

They said t hey had injected £600,000 of their own money into the firm in an effort to rescue it and denied failing to pay for personal security and health insurance. They said no taxpayers’ money had been spent on the event at the De Vere Wokefield Estate in 2017, adding: ‘This was an important event to allow staff from our regional offices to work together on business planning and training…

‘None of the funds were taxpayer funds; these were all paid for from company profits reinvested in the company rather than taken out by shareholde­rs.’

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