Redknapp is cleared and Capello quits in football's day of drama
Acquittal leaves taxman facing storm of criticism – and Spurs manager with intriguing job prospect
Harry Redknapp began the day facing a prison sentence and ended it as the overwhelming favourite to be the next England football manager after an extraordinary day that saw him cleared of tax evasion charges and Fabio Capello resign as coach of the national side.
Mr Redknapp made an emotional address outside Southwark Crown Court after he was cleared of all charges relating to payments into his Monaco bank account following an £8m inquiry and two trials. The verdict represents a major blow for the taxman, with HM Revenue & Customs failing to convict anyone following a series of high-profile raids on the homes and clubs of Premier League players and executives during its long-running inquiry into football corruption.
HMRC said after the verdicts that it had no regrets about its decision to pursue the case against Mr Redknapp and it would not "back off someone because they are a high-profile or well-loved personality". But the agency appeared isolated last night after the City of London Police made it clear that HMRC took the lead role in the inquiry. The failure is the latest embarrassment for HMRC, which allowed Vodafone to pay just £1.25bn in a tax dispute with the Government, despite a potential bill of £8bn, and allowed Goldman Sachs to avoid £5m to £8m in tax penalties.
The conclusion of the case was marked by near silence yesterday and a hug in the glass-panelled dock between Mr Redknapp, 64, and his co-defendant Milan Mandaric, 73, when a jury cleared them of tax evasion.
Mr Redknapp had maintained that two payments to his offshore bank account by his then chairman at Portsmouth Football Club were seed money for investment. The Crown had claimed they were bonuses for bringing success to the club that were paid offshore to evade tax.
The tale took a dramatic twist last night when the FA announced that Capello had resigned after being called to a meeting to explain why he had publicly challenged the decision to strip John Terry of the captaincy during an interview on Italian TV on Sunday. Mr Redknapp is the clear favourite to succeed him and bookmakers had stopped taking bets on him yesterday even before the FA announcement. Earlier Redknapp was cheered by supporters on the steps of the court after the two-week trial. "It's been five years and this is a case that should never have come to court because it's unbelievable really," he said.
It can be reported for the first time that Mr Mandaric was cleared of tax evasion at an earlier trial last year along with the club's former chief executive Peter Storrie over payments to players. The payments amounted to more than £750,000. The two men had denied any financial wrongdoing. One of the payments was a £550,000 termination payment to the Israeli international Eyal Berkovic that was made to a company registered in the British Virgin Islands and controlled by the footballer. Mr Storrie alone was charged over another payment made via the Monaco account of football agent Willie McKay. It was described by prosecutors as a €300,000 "golden hello" for the Senegalese midfielder Amdy Faye when he moved from the French side Auxerre to Portsmouth in 2003.
The two trials marked the conclusion of a long-running inquiry by the City of London Police into football corruption and money laundering that started in late 2006. Nine people were arrested, but only three were ever charged. Nobody has been convicted. The Crown Prosecution Service confirmed there are no outstanding cases.
The two cases brought to light the opaque nature of football financing. In 2010, 14 of the Premier League clubs and five in the Championship were based offshore, according to a report by Christian Aid.
"Football is a bit like the banking industry," said Jon Holmes, a former agent and former chairman of Leicester City FC. "It's unregulated, everyone says it's working because large amounts of money are shifting around from country to country and nobody is willing to take a stand calling for regulation."
Bob Wishart, from the City of London Police, said the initial investigation into money laundering turned into a tax inquiry and the case was passed on to HMRC. "We have supported the HMRC throughout this investigation," he said. A CPS spokesman said: "We concluded that there was sufficient evidence for a realistic prospect of conviction and that a prosecution was in the public interest."
Sandra Redknapp: The 'terrified' wife
A telephone call from her son moments after the 'not guilty' verdicts alerted Sandra Redknapp to the news that her husband had been cleared.
Her son Jamie, the former England footballer who was ever-present during the trial, made the call from the courtroom after Harry Redknapp was cleared of tax evasion.
Mrs Redknapp accepted flowers from well-wishers at her home in Dorset yesterday, above, and despite her absence from the trial she featured prominently. Mr Redknapp spoke of her terror during the raid at their home in November 2007 while he was away in Germany. The manager said his wife had thought he had died in a plane crash when she saw the press cameras flash outside their home. The pictures of the raid appeared in The Sun and Mr Redknapp's lawyers said the paper had been tipped off – a claim denied by the City of London Police.
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