The threat comes as Mr Regan prepares to deliver sensitive CWS documents to the High Court today as he attempts to launch his pounds 1.2bn bid for the whole society including the Co-op bank, the funeral parlours and the supermarkets.
A letter sent to Mr Regan by Graham Melmoth, the CWS chief executive, casts doubt on Lanica's explanation that a pounds 2m payment to Ronald Zimet of Trellis International in 1995 was made for assistance in negotiating an extension of a deal between the CWS and Hobson, a food company that was controlled by Mr Regan.
It says both Allan Green and David Chambers, the two CWS managers who were responsible for the deal and who were suspended last week, have said they knew nothing about Trellis or Mr Zimet.
They have told the CWS that negotiations between the two companies had been conducted directly with Mr Regan with no use of a middle man.
The letter states: "If the 'Trellis role' was fully disclosed at the time, presumably you will have no difficulty in telling me what that [Mr Zimet's] role was, why you were prepared to pay in excess of pounds 2m for it and who at the Co-op was told about it."
It closes: "These are simple and straightforward questions which call for simple and straightforward answers. If these do not reach us by close of business tomorrow [Tuesday] arrangements will be made to see representatives of the Serious Fraud Office."
SBC Warburg, Hobson's former merchant banking adviser, cast further doubt on the validity of the payment yesterday. It issued a statement saying: "Contrary to recent press reports, SBC Warburg confirmed today that Swiss Bank Corporation did not 'clear' a payment made to Trellis International by Hobson plc in January 1995."
It said it was informed of the extension to the supply agreement in January 1995 "but not of the payment to Trellis". It said it was not informed about the payment until March of that year. It says it resigned as financial adviser to Hobson "shortly thereafter".
The SBC Warburg statement contradicts a version made by the Regan camp at the weekend when it claimed that the merchant bank had been aware of the payment and approved it. The merchant bank said yesterday that it resigned shortly after learning about the payment.
Separately, KPMG, the accountancy firm and formerly Hobson's auditors, said it only signed off the company's accounts following assurances from both Mr Regan and his fellow director, David Lyons, that everything was in order.
It said that if that assurance had not been forthcoming it would have had to qualify the accounts.
The issue is complicated by the fact that some of the advisers working with Mr Regan at the time of the Hobson deal, are now representing the CWS and vice versa.
One adviser who worked on Mr Regan's affairs while at Swiss Bank is representing the CWS at the merged SBC Warburg.
Another connection is that KPMG is now auditor to the CWS. Furthermore, KPMG is working on the investigation of business dealings between Mr Green, Mr Chambers and Mr Regan. KPMG also dismissed any suggestion of conflict of interests. "We don't believe that is the case. The forensic accounting team conducting the investigation is run out of Manchester. The audit team at Hobson was run out of London. The Chinese walls are in place."
SBC Warburg said that while it was possible that the bank would have confidential information on Mr Regan's affairs "there was no question of this being used".
And SBC Warburg said it did not have any details on who Trellis International or Mr Zimet were or what the payment was made for.
Though Mr Zimet has been described by the Lanica camp as a British-based businessman, records filed at Companies House show he has no UK directorships.
As the bid battle became even more intense, Lennox Fyfe, the CWS chairman, repeated yesterday that none of the society's assets were for sale and that its 30-strong board was united in its opposition of the Lanica approach. "I'm aware of what people in the society are saying and I know what they feel. I haven't spoken to a single person who supports Mr Regan."
The display of a united front came as it emerged that Mr Regan had missed the deadline for calling a special meeting to discuss his proposals before the CWS annual meeting on 17 May. The deadline passed on Friday.
That meeting will include motions proposing to maintain the CWS and its co-operative traditions in its current form.
Mr Regan is expected to comply with a High Court order demanding that he return sensitive Co-op documents to the court and say how they were planned to be used. The sworn affidavits are due by 4pm today.
If he can prove he is not using confidential information, Mr Regan is expected to proceed with a pounds 1.2bn break-up bid for the CWS. It could come later this week.
However, it is thought that Mr Regan may step down as a director of Galileo, the offshoot of Lanica Trust that is co-ordinating the CWS offer even though he is its principal architect.
It is thought Mr Regan has been holding discussions with the Stock Exchange over the issue. The Exchange is understood to be uneasy about the relationship between Lanica Trust and Galileo.
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