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'I wouldn't ruin my life to nick a couple of quid'

Redknapp reveals in court he almost lost £8.5m house in ill-advised property deal

Harry Redknapp told police he could "blow your brains away" with the amount of money he had "squandered by trusting people" and that he had almost lost his house in one £8.5m property deal in Southsea, a court heard yesterday.

The Tottenham Hotspur manager said that he had put up his home in Poole as security for an £8.5m loan on the deal, which he later estimated had lost him around £6m. On another occasion he agreed to a £250,000 loan to a prospective buyer of Oxford United in order that it might help to keep his friend, Jim Smith, in the manager's job, only for the loan not to be repaid.

On the fifth day of Redknapp's trial for tax evasion, the court heard a recording of an interview he held with City of London police in June 2009 in which he said there was no reason for him to "fiddle" his income tax. "I'm not going to ruin my life, and my wife's life and my boys. I've brought up a fantastic family, to try and nick a few quid off the income tax? Why? I'm not into that. I don't need that. I'd rather give you a hundred grand than try and nick a few quid off you."

The judge, Anthony Leonard QC, adjourned the hearing at around 3pm, and Redknapp, with his son Jamie, travelled from Southwark Crown Court to the Grove hotel in Hertfordshire to meet up with his Spurs team, ahead of last night's FA Cup fourth-round tie with Watford at Vicarage Road.

Redknapp is accused, along with his former Portsmouth chairman Milan Mandaric, of two counts of cheating the public purse. The prosecution allege that two payments totalling £189,000 from Mandaric to Redknapp's bank account in Monaco between 2002 and 2004 were undertaken in order to evade British tax authorities.

Redknapp claims that the money was controlled by Mandaric as an "investment" on his behalf of which he had no knowledge. The court heard the City of London police interview in 2009 in which he discussed previous investments of his that had been "disastrous".

Redknapp told police that he had borrowed £8.5m from the banks to finance a property deal in Southsea. In the recording he added that he subsequently met the businessman Samir Khan through his former Portsmouth goalkeeper David James and had allowed him a half-share of the potential profits, despite the fact that Khan had only supplied half the £200,000 Redknapp had invested,

"I've signed a form that says he's half in and he ain't put no money in. I've signed the forms now, you can ask my solicitor in Bournemouth, and they can't believe I didn't read anything. I thought he said: 'I'll meet you half way. I'll put half in what you put in'.

"He put half in what I put in up to that point and my own money was about £200,000. Now he's in for nothing and he has half the profit. The only downside is it's only worth £4m now and I've done like £6m. My house is up against it but that's where I'm at.

"That's how useless I am with things, and you can check with my solicitors if you like ... ask him if he's ever come across anyone as bad business-wise as I am. Unfortunately I live my life like that."

In the recording Redknapp said that on another occasion, he had been persuaded by Smith, then manager of Oxford, to provide a loan of £250,000 to finance a prospective takeover of the club by Nick Merry on the guarantee that it would be repaid within five days. "That's 20 months ago and the guy didn't buy the club," Redknapp said. "I can tell you 10 stories like that."

Redknapp said he and his family were "givers not takers" and that he had an annual golf day that raised £15,000 for a leukaemia charity, £10,000 of which he donated directly himself. He claimed to have paid £1m in income tax in 2008.

Earlier Redknapp said he had forgotten about the Monaco account to the extent that it "wasn't a part of my life". He revealed he does not carry credit cards apart from one issued to him by Tottenham and a petrol card. He said that his memory was so bad he "couldn't tell what year we [Portsmouth] won the Championship." Mr Leonard QC told the jury it was likely that the trial would "trickle" into a third week. The two men deny the charges.