Rooney's gambling debt of £700,000 wiped out

The dispute over Wayne Rooney's alleged £700,000 gambling debt was settled last night, after a week of talks between the 20-year-old footballer's agent and bookmaker.

The Manchester United and England striker had reportedly run up the debt in the five months to February by betting on horses, dogs and football with Stephen Smith, a business associate of Rooney's England striking partner, Michael Owen.

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"Outstanding issues between the company and Wayne Rooney have now been fully resolved as a result of talks between Stephen Smith and Paul Stretford of Proactive Sports Management," said a statement last night by Mr Smith's company, Goldchip, adding that the matter was now closed.

The settlement comes a week after new of Rooney's debt first emerged amid claims that he was part of an England betting ring which included Owen, John Terry, Frank Lampard and Rio Ferdinand. The group were reported to bet on football, but not matches they were involved with. As their betting became more serious, Owen was said to have found the bets too large to handle and introduced his colleagues to Mr Smith's bookmaking operation.

Rooney placed his bets by telephone and text message. He never met the man who ran his account on behalf of Mr Smith's company. Rooney was uncertain about the exact extent of his debts, and alerted his agent to the problem in February. He dismissed speculation of a rift with Owen over the alleged betting ring.

News of Rooney's debt sparked warnings of a gambling "epidemic" among leading footballers in the UK. Peter Kay, the chief executive of the Sporting Chance charity, last week described gambling as "the largest addiction within football" and warned that it has become "an accepted, tolerated form of relaxation for players condoned by clubs and managers".

Rooney earns an estimated £50,000 a week from playing for Manchester United and several million a year more from sponsorship deals.

Earlier last week, Rooney accepted £100,000 damages from the publishers of The Sun and the News of the World after the newspapers falsely alleged he slapped his fiancée, Coleen McLoughlin.