Page last updated at 17:25 GMT, Thursday, 10 April 2008 18:25 UK

Tax probe led to football arrests

Karren Brady
Karren Brady refused to comment as she left her home

Birmingham City has said the arrest of its co-owner and managing director relates to an inquiry into payments to a football agent and two players.

David Sullivan and Karren Brady were arrested on Wednesday by City of London Police and are currently on bail.

Shares in the club were suspended at the club's request after the pair were quizzed over allegations of false accounting and conspiracy to defraud.

In a statement the club said it related to tax and national insurance payments.

It said the investigation was focussed on "payments to a football agent and two players dating back to 2002/2003" and involved "the payment, or possible non-payment of PAYE and National Insurance contributions".

'Complicated tax matter'

"There is absolutely no allegation that any director of the company or the club itself have benefited financially from any of this activity."

Officers raided the club last month in what was said to be "an ongoing investigation into football corruption".

As shares resumed trading at 1400 BST, Mr Sullivan said he felt the police statement was "very unfair", adding that they had nothing to hide.

Speaking from his home in Theydon Bois in Essex, he said: "I'm shocked by the whole thing. The police statement was very unfair. This is a complicated tax matter.

David Sullivan
David Sullivan is the club's co-owner

"We have absolutely nothing to hide. We have done nothing wrong, and we think in due course this will be proven."

Ms Brady made no comment as she left her home in Knowle, Solihull, shortly before 0800 BST.

Ms Brady, 39, and Mr Sullivan, 59, were questioned and bailed by the City of London force's economic crime unit.

A club spokesman said the pair had been interviewed by officers as part of a "longstanding appointment" and they had "happily done so".

The 2002/3 season was the club's first in the top flight of English football for 16 years and saw them match their highest finish since 1978.

Seven on bail

Meanwhile, it has emerged that shares in a company owned by the businessman Carson Yeung, who recently mounted a takeover attempt of the club, have also been suspended.

Trading has been halted in Grand Top International's shares on the Hong Kong stock exchange, the BBC's sports correspondent Pat Murphy said.

Mr Yeung owns 29.9% of shares in Birmingham City.

Seven other people are currently on bail as part of the City of London Police investigation in to allegations of corruption in football.

Among those previously arrested are Portsmouth manager Harry Redknapp, the club's chief executive Peter Storrie and former chairman Milan Mandaric.

Former Portsmouth midfielder Amdy Faye, a Senegalese international, has also been questioned by police.

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