Milan Mandaric tried and acquitted in separate tax trial it is revealed

Milan Mandaric was tried and acquitted of another tax fiddling charge at Portsmouth, it can be revealed today.

The former chairman and ex-chief executive Peter Storrie were both cleared by a jury after being accused of a £600,000 tax dodge over player transfer payments.

Following the not guilty verdicts, Mr Storrie applied in November to have a reporting ban lifted, saying it was having a "devastating" impact on his personal life.

But a judge ruled against his application pending the conclusion of Mandaric's trial alongside Harry Redknapp.

A jury at Southwark Crown Court cleared Storrie of two counts of cheating the public revenue and one count against Mandaric.

They dismissed claims from prosecutor John Black QC that £424,000 income tax had been evaded and £177,000 had been dodged in National Insurance (NI) contributions.

Storrie, 60, of Hayling Island, Hampshire, was accused of arranging a signing-on fee to Amdy Faye to be paid via the bank account of agent William McKay "in order to conceal its true nature and purpose".

He and Mandaric were also jointly accused of arranging for or causing to be paid a termination payment to Israeli international striker Eyal Berkovic via the account of Medellin Enterprises Limited, a company registered in the British Virgin Islands.

Mr Black had told the jury that during the period covered by the charges the club was struggling financially, and, in its dealings in the football transfer market, working within very tight budgetary constraints.

Correspondence with the tax authorities from the time showed that there were repeated requests for time to pay, and references to cash flow problems.

"There was a culture of non compliance at Portsmouth City Football Club, a sense that the taxman was fair game, a quite calculated decision to evade tax when it fell due," Mr Black had said.

"The Crown's case in relation to the two deals is that the defendants went beyond playing with the timings of the payments and went so far as to arrange ways of avoiding payment."

However, the jury accepted the defence case that the two defendants had not set out to avoid tax.

Judge Anthony Leonard blocked publication of the verdicts despite Mr Storrie's lawyer Natasha Wong saying her client was being called "Storrie teller" and a "tax dodger" online.

She said: "He is in a position where he is an acquitted defendant but is not permitted to have any reports on that fact.

"He has been acquitted but the public cannot be made aware of the acquittal which has devastating consequences to his personal life.

"Mr Storrie is being represented as someone who has been convicted, someone who is serving a sentence, and all sorts, when he is not."

Portsmouth had just enjoyed their best ever season and won promotion to the Premier League - but the club's football success was not matched by financial security.

Redknapp believed that Faye, from Senegal, was a player who would give Portsmouth a fighting chance of holding their own in the top division.

Mr Black had said that Storrie dishonestly arranged the financial side of the transfer in such a way as to evade the payment of tax on the deal, thereby freeing up enough money to pay the signing-on fee that the player was demanding to come to the club.

"The Crown's allegation is that Mr Storrie disguised the fact that a substantial signing-on fee was being paid to the player, by arranging with an agent who was involved in brokering the deal, William McKay, that the signing-on fee would be added to Mr McKay's agent fees from the deal, and paid into Mr McKay's bank account in Monte Carlo before Mr McKay passed part of that money on to the player."

There was no personal reward for Storrie from the deal, but he must have had an eye on the improved prospects that it would bring the club, Mr Black said.

Storrie's earnings rose from £171,000 gross income in 2002/3 to £1,192,000 in 2007/8, and much of his income was in the form of bonus payments, Mr Black said.

The transfer of Faye went through for 1.8 million euros, but the player's "extremely lucrative" contract made no mention of a signing-on fee.

Portsmouth, through the Football Association, paid Mr McKay £560,000, which was "ostensibly" agreed for his fee, Mr Black said.

But examination of Mr McKay's bank account showed that he passed on 350,000 euros to Faye's bank account in Senegal.

"The Crown's case is that the arrangement was that £560,000 would be paid by Portsmouth to William McKay, and from that sum, Mr McKay was to retain £260,000 by way of agent's fee, and was to pass on to Mr Faye £300,000 by way of disguised signing-on fee," Mr Black said.

The figure of £560,000 was reflected in a number of other documents relating to Portsmouth - "as it had to be if the fraudulent scheme was to succeed," Mr Black said.

But other Portsmouth documents gave the agent's fee as £260,000, Mr Black said.

As to the termination payment to Berkovic, it was to persuade an under performing player to walk away from the remainder of his contract.

"There was nothing wrong with that in itself, what was wrong was for that termination payment to be deliberately hidden from the tax authorities," Mr Black said.

It was paid into a Swiss bank account in the name of a British Virgin Islands company controlled by Berkovic and arranged specifically for the purpose of receiving the termination payment, Mr Black said.

PA

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In quotes: What Harry Redknapp told the jury