Mandaric cleared in earlier tax fiddling hearing

Mr Mandaric and Portsmouth’s ex-chief executive Peter Storrie were both cleared by a jury after being accused of a £600,000 tax dodge over player transfer payments.

Details could not be published ahead of the Redknapp trial for legal reasons but Mr Storrie and Mr Mandaric, who was Portsmouth chairman at the time of the alleged offences, were previously cleared of cheating the public revenue.

A jury at Southwark Crown Court dismissed claims from prosecutor John Black QC that £424,000 income tax had been evaded and £177,000 had been dodged in National Insurance (NI) contributions.

Mr Storrie was accused of arranging a signing-on fee to Amdy Faye to be paid via the bank account of agent William McKay “in order to conceal its true nature and purpose”.

He and Mr Mandaric were also jointly accused of arranging for or causing to be paid a termination payment to Israeli international striker Eyal Berkovic via the account of Medellin Enterprises Limited, a company registered in the British Virgin Islands. Mr Black had told the jury the club was struggling financially, and, in its dealings in the football transfer market, working within very tight budgetary constraints.

Correspondence with the tax authorities showed that there were repeated requests for time to pay, and references to cash flow problems.

“There was a culture of non- compliance at Portsmouth City Football Club, a sense that the taxman was fair game, a quite calculated decision to evade tax when it fell due,” Mr Black had said.

“The Crown’s case in relation to the two deals is that the defendants went beyond playing with the timings of the payments and went so far as to arrange ways of avoiding payment.”

However, the jury accepted the defence case that the two defendants had not set out to avoid tax.