Jan. 26 (Bloomberg) -- A News Corp. newspaper closed last year after a telephone hacking scandal paid 8,000 pounds ($12,524) to an unidentified person for information about a tax evasion investigation into Tottenham Hotspur manager Harry Redknapp and Sheffield Wednesday owner Milan Mandaric.
Mandaric, 73, and Redknapp, 64, are on trial in a London court on two charges of tax evasion over $295,000 paid into a Monaco account named after the soccer manager’s dog, Rosie, when the two worked together at Portsmouth soccer club.
Rob Beasley, a sports reporter from the defunct News of the World Sunday tabloid, testified yesterday after the jury of eight men and four women were played recordings of his interviews with the two defendants. The tapes were made almost a year before the men were charged in January 2010.
Beasley, who now works for the News Corp.-owned Sun newspaper, said the source he paid wasn’t a member of the investigating City of London Police or a U.K. government tax official. The News of the World was closed after evidence its reporters hacked mobile phones of celebrities and a murdered teenager. A separate police probe into allegations of paying police for information is currently under way. Bloomberg News is a competitor of News Corp.
Redknapp and Mandaric deny charges of cheating the public revenue. The first charge alleges Mandaric paid $145,000 into the Monaco account from April 1, 2002, to Nov. 28, 2007. The second charge relates to payment of $150,000 from May 1, 2004, to Nov. 28, 2007.
Beasley spoke to Redknapp two days before the 2009 League Cup final, which Tottenham lost. In the recordings played in court, Redknapp threatened to sue the newspaper if it published inaccurate material. Redknapp denied he hadn’t paid his taxes in the conversation, saying Mandaric had told him the tax had been paid and the money was a bonus he was due for a player trade.
In a story published Oct. 4, 2009, Beasley reported Redknapp was to be questioned again by officials from her Majesty’s Revenue & Customs about his offshore accounts, and lawyers and investigators planned a meeting about how to proceed with the case.
Beasley warned Redknapp “to be careful about who’s around you,” saying it wasn’t a coincidence the information came out before a big game.
The reporter also spoke to Mandaric, and the former Portsmouth owner denied the money had anything to do with soccer. Mandaric told the reporter he used the money to help Redknapp, who he considered to be a friend, with an investment unconnected with the pair’s soccer related work. He also told police, according to interview transcripts, the payments were loans to Redknapp.
The explanations were “contradictory, inconsistent and lack credibility,” prosecutor John Black said yesterday. “Did they really think that these payments from the owner and chairman of the club to the manager of the club would not be subject to income tax?”
The Monaco account was “set up quite deliberately for receipt of the bonus sum.”
The jury was also read transcripts of a 2006 interview between Redknapp and an investigator working on behalf of the Premier League looking into irregularities in player trades. It came four years after the ‘Rosie 47’ account was opened, and the first time authorities found out about it.
“If there is any mud to sling, I seem to be on the end of it,” Redknapp is quoted as telling investigators from Quest Ltd. “You can look anywhere you want. No one will find anything on me. There is nothing in the world on me.”