Shapps previously held a seat in the Cabinet as Conservative co-chairman and as minister without portfolio at the Cabinet Office, but he has now been demoted to minister of state at the Department for International Development. In a further embarrassing turn, his co-chair of the party, Lord Feldman, has been promoted to sole chairman and will take a place in Cameron's top team.
His story is a remarkable fall from grace. As one of the key figures in the Conservative 2015 campaign, Shapps might have expected to walk into a top cabinet post following the party's shock result in last week's General Election that handed them a small majority.
But his reputation has been marred after admitting in March that that he worked as a web marketer under the pseudonym Michael Green after becoming an MP in 2005, the Guardian reports. For at least a year, Shapps advertised a "mentoring programme" to hire staff and produce software to create websites that could make his clients a "ton of cash by Christmas," according to the Guardian.
Shapps denied having the second job for several years after the news came to light in 2012. At the time, David Cameron publicly came out in defence of Shapps, with Downing Street confirming that the Prime Minister had "full confidence" in him. But earlier this year, Shapps admitted in an interview with LBC Radio that he had "screwed up" by "over firmly" denying that there was no crossover of his previous work and his time as an MP.
The chairman's cause wasn't helped by allegations in April that he "or someone acting on his behalf" had edited the Wikipedia pages of Conservative rivals as well as removing embarrassing references on his own page.
Shapps strongly denies the claims.
Nevertheless, it seems that for now he will have to take a back seat in Westminster.