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Redknapp case: Mandaric and Redknapp cleared of all charges

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8th Feb 2012
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Both Harry Redknapp and Milan Mandaric have been found not guilty on all charges in the high-profile tax evasion trial at Southwark Crown Court.

Redknapp and Mandaric hugged as the jury cleared them of all counts.

After a two-week trial jurors accepted Redknapp's denials that he avoided tax on any payments over £189,000 found in a Monaco account.

The prosecution based the allegation on a News of the World report that Redknapp admitted to journalist Robert Beasley that the money was a bonus for the sale of Peter Crouch.

This brings to a close a five-year £8m police investigation which failed to yield a single conviction.

HMRC released a statement saying they have “no regrets” over bringing the case regardless of the outcome.

* * *

Final arguments

7 Feb 2012 - After a summing up from Judge Anthony Leonard, the jury retired at Southwark Crown to consider their verdicts on tax fraud charges against former Portsmouth FC (now Spurs) manager Harry Redknapp and ex-chairman Milan Mandaric.

The case is based on payments worth £189,000 into an offshore bank account in Monaco that the prosecution alleged were work-related bonuses arising from the sale of striker Peter Crouch.

Both Redknapp and Mandaric deny the charges.

As summarised on Friday, the prosecution rests mainly on Redknapp’s admission to News of the World journalist Robert Beasley that the money was a bonus for selling Crouch.

When cross-examined, Redknapp had answered, “I don't have to tell Mr Beasley the truth. I have to tell police the truth, not Mr Beasley, he's a News of the World reporter.”

John Kelsey-Fry QC, defending Redknapp, dismissed the Crown’s evidence on this point as “repugnant to all our basic instincts of fairness”.

Kelsey-Fry said that the trial would have never have taken place if Redknapp had not disclosed the Monaco account voluntarily to the Premier League’s investigation into transfer-related bungs to football managers.

Mandaric’s barrister Lord Macdonald QC called the prosecution evidence “hopelessly weak”.

He likened the relationship between the two defendants to that of Jack Lemmon and Walter Matthau in the Neil Simmon comedy ‘The Odd Couple’. That friendship “was at the heart of this case” and was what had prompted what the defence claimed were loans from Mandaric to help Redknapp build up an investment portfolio. The jury would have consider the simple question of whether Mandaric was deliberately involved in a dishonest scheme to defraud HMRC, his lawyer said.

* * *

Redknapp admits lying to reporter

2 Feb 2012 - Tottenham Hotspur manager Harry Redknapp admitted lying to sports journalist Rob Beasley about the source of payments into his Monaco account to prevent a negative story appearing ahead of a cup final.

Redknapp denied prosecution claims that he "desperately" tried to cover up allegations the £189,000 Monaco payments were bonuses for transfer profits.

He told Southwark Crown Court "I have to tell police the truth, not Mr Beasley, he's a News of the World reporter".

Redknapp told prosecutors that he referred to payments as ‘bonuses’ he was due for the sale of Peter Crouch to from Portsmouth to Aston Villa because he "wanted to make the point to Mr Beasley that it was paid by my chairman."

Prosecutor John Black QC accused Redknapp of "letting the cat out of the bag" during the phone conversation with Beasley.

To which Redknapp replied: "Why would I let the cat out of the bag to the News of the World if I had done anything wrong?"

At the end of his cross-examination Redknapp replied to the accusation he had been ‘telling a pack of lies’ to the court: "You think I put my hand on the bible and told lies? That's an insult, Mr Black, that's an insult."

He also told the court he had not told his accountant about the account because “there was nothing in it" and that the Rosie account was not a secret.

Both Redknapp and co-defendant Milan Mandaric deny two counts of cheating the public revenue through "bungs" worth £189,000 in a Monaco bank account.

The jury has been told it will retire to consider its verdicts on 7 February. The trial continues.

* * *

Payments not a major factor to Mandaric

30 Jan 2012 - Former Portsmouth chairman Milan Mandaric has told Southwark Crown Court payments made to Harry Redknapp were "not a major factor" in his life.

The court heard that Mandaric's lawyer had sent Redknapp's solicitor a letter asking for the money paid into the manager's Monaco account to be returned.

However, he said that the request seeking repayment of cash was not "my number one priority".

Mandaric also said the two were now friends again after a ‘divorce’ over Redknapp joining rival club Southampton.

Both men are accused on two counts of cheating the public revenue - both of which they deny.

The first charge occurred between 1 April 2002 and 28 November 2007, when Mandaric paid £93,100 into a bank account held by Redknapp in Monaco. The second relates to £96,300 allegedly paid by Mandaric to the same account between 1 May 2004 and 28 November 2007.

The former chairman said the charges were sad, unfair and an insult: "Never, ever in my mind was coming the idea that I could get rich evading money. I did not even know what the word meant. I did not cheat anyone."

It was also disclosed on the sixth day of the tax evasion trial that Redknapp earned £3m a year at Portsmouth while they were still a Championship club, and more than £4m towards the end of his first spell as manager.

Mandaric described Redknapp as “a special guy, a special manager but above all he was a special friend,” and that he “earned every penny”.

* * *

Relied on accountant to manage affairs

26 Jan 2012 - Harry Redknapp has revealed during his tax evasion trial at Southwark Crown Court that he “can’t write” and that his accountant runs his life.

Jurors were played a police interview where the Tottenham boss said he was “the most disorganised man in the world”, writes like a two-year-old and kept no personal financial records.

Asked by police in June 2009 about Mandaric’s payments to the Monaco account opened under the codename ‘Rosie 47’, Redknapp said: “My accountant runs my life, I don’t have wage slips, I have not seen a wage slip in 10 years. I don’t see bank statements.”

He added that his inability to write was a problem, and explained why he left all financial management to his accountant: "I have a big problem, I can’t write, so I don’t keep anything. I’m the most disorganised person and I’m ashamed to say in the world, I can’t work a computer, I don’t know what an email is, I can’t, I have never sent a fax and I’ve never sent a text message.

Redknapp explained how his accountant, Malcolm Webber, runs his life: “I pay a fortune to my accountant to look after me you know. He writes the cheques for me and my wife. I have never wrote a letter in my life.

He also told police that he was so reliant on his accountant for financial information he was unaware that he had received a £70,000 bonus from Tottenham and that he had not been paid for his Sun newspaper column for 18 months.

Jurors were also told how he had made a list of failed business investments, including losing £250,000 in an unsuccessful takeover bid at Oxford United.

* * *

Sole responsibility' for Monaco account

25 Jan 2012 - Harry Redknapp had sole responsibility for the Monaco bank account in the name of his dog, 'Rosie 47’, into which money was paid by Milan Mandaric, Southwark Crown Court heard today.

Jurors heard that the only signature on records for the account at the centre of £189,000 ‘bung’ allegations belonged to the Tottenham Hotspurs manager.

Giving evidence via videolink David Cusdin, vice-president of HSBC in Monaco between 2000 and 2005, said he was aware Redknapp had visited the bank in 2002 to open a "non-advisory account" and confirmed that the client would have to be present to open an account.

He told the court "in this case, it is a single person on the account ... one signature on the account."

Cusdin added: "I was certainly aware of his visit - it was quite possible that I didn't open the account, it was one of my team - but I was certainly aware of the visit".

He also said that Mandaric was an account holder at the bank and he had met him on several occasions,  adding that "Mr Mandaric, is a perfect gentleman... he would always ring prior to the visit".

The prosecution has alleged that Mandaric made payments totalling £189,000 into the Rosie 47 account when he was chairman and Redknapp was manager at Portsmouth FC.

Redknapp and Mandaric both deny two charges of cheating the public revenue during their time at Portsmouth.

The court also heard today that Redknapp had previously told police officers: "I am not going to fiddle taxes, I pay my accountant a fortune to look after me.

"I am completely and utterly disorganised. I write like a two-year-old and I can't spell."

Jurors have also heard how he had made "disastrous" business decisions, including losing £250,000 in an unsuccessful takeover bid at Oxford United.

The trial continues.

* * *

Offshore account exposed

24 Jan 2012 - Tottenham Hotspur manager Harry Redknapp opened a Monaco bank account named after his bulldog Rosie in order to conceal a £189,000 ‘bung’, or off-record bonus, from his former club chairman, Southwark Crown Court has heard.

The jury was told that illicit payments were concealed in a Monaco bank account under the code name ‘Rosie47’ - a combination of the dog’s name and his year of birth.

Redknapp is facing two charges of tax evasion and has been accused of “deliberately and dishonestly” cheating the public revenue along with co-defendant Milan Mandaric, the former chairman and owner of Portsmouth FC.

The court heard that Redknapp received the money from Mandaric in lieu of commission payments on the transfer of players, including the sale of Peter Crouch to Aston Villa in 2002.

Under the terms of his contract as director of football at Portsmouth, Redknapp received 10% of the net profit on player transfers he conducted, however this was then reduced to 5% on his appointment as manager of the club.

The jury was told that in April 2002 he was paid a £115,000 bonus by Portsmouth, but prosecutor John Black QC said that Redknapp, believing that he should have received 10%, set about receiving it via the Monaco account.

Both Redknapp and Mandaric deny the charges which are alleged to have taken place during his first spell as Portsmouth manager between 2002 and 2004.

The prosecution also said that Redknapp did not declare payments made to or the existence of Monaco account 'Rosie47' until four years after it was opened.

Black will complete his opening statement to the jury today before calling the first witnesses at Southwark Crown Court. The trial continues.

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David Winch
By David Winch
12th Feb 2012 13:22

Consequences of acquittal

In my view it would not be proper for HMRC (or any other arm of the state) to suggest that the defendants were actually guilty of the offences of which they have been acquitted.

That means that HMRC cannot now proceed on the basis that the payments were remuneration paid in the way that it was in order to deliberately conceal it from HMRC with the intention of evading tax (and NIC).

However I do not think HMRC are precluded by the verdicts from proceeding to raise PAYE assessments in relation to the payments and to charge interest and penalties (based on neglect).

If such assessments were raised then perhaps they would be appealed and a tax tribunal might have to determine whether the payments were remuneration (and hence subject to PAYE).

However HMRC may now take the view that the payments were not related to the employment.  Obviously if they take that view then no PAYE issues would arise.

Had the issue been simply whether or not the payments were taxable then that would have gone to a tax tribunal rather than a criminal court.

David

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By The Black Knight
13th Feb 2012 09:35

to be fair

You can't win them all and I should think the Vantis case will more than cover this one.

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