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Harry Redknapp and Milan Mandaric were both found not guilty on two counts of tax evasion on 8 February 2012 at Southwark Crown Court…

Tottenham boss Harry Redknapp and Milan Mandaric, chairman of Sheffield Wednesday, were yesterday both cleared on two counts of cheating the public revenue following their highly anticipated tax evasion trial that lasted just over two weeks.

Redknapp and Mandaric’s tax evasion trial was centred on two payments allegedly paid from Mandaric to Redknapp totalling $295,000 made into a ‘secret’ bank account in Monaco between 1 April 2002 and 28 November 2012; Payments the prosecution argued had avoided around £10,000 in income tax and national insurance.

The Crown alleged that both payments were made “with intent to defraud and to the predjudice of HM Revenue and Customs as a result of or in connection with Henry James Redknapp’s employment and as a reward for services.”

The prosecution argued that payments from Mandaric to Redknapp’s ‘secret’ Monaco account – named ‘Rosie47’ after his beloved pet bulldog and the year of his birth – had been a $145,000 bonus in 2002 for the transfer sale of Peter Crouch and a $150,000 reward for Portsmouth FC beating Manchester United in a Premier League match that saved the club from relegation in 2004.

9 days after Redknapp took up the position of manager at Portsmouth FC, previously acting as Director of football for the club, Peter Crouch was sold to Aston Villa.

When Redknapp was Director at Portsmouth FC he was entitled to 10% net profit on all player transfers, this reduced by half to a 5% bonus when he became manager.

For more information on the prosecutions opening case at Southwark Crown Court click here to read our article ‘Prosecution open the case at Redknapp and Mandaric Tax Evasion Trial’.

Under cross-examination Mandaric accepted that Redknapp was “not a happy bunny” for only receiving 5% of Peter Crouches transfer profit but denied that money paid into Redknapp’s ‘Rosie47’ Monaco account had been a bonus.

When put forward by the prosecution that money was “partly in relation to the sale of Peter Crouch, isn’t that right?” Mandaric replied: “Absolutely not.”

The prosecution then claimed that the second payment of $150,000 to Redknapp’s ‘Rosie47’ account was a reward from Mandaric for Portsmouth’s defeat over Manchester United in April 2004; which subsequently secured Premier League survival for Portsmouth FC.

Mandaric said that Portsmouth won the match, “because we had a better team. A better manager”, and responded to the prosecution’s claim by saying that it would have been an “insult to say to Harry I’ll give you £100,000 on top of your four million [contract]”.

Mandaric said that the ‘Rosie47’ account was not a ‘secret account’, that himself and Redknapp had “never in a million years” discussed trying to hide money in Monaco and that it was “sad [he had] to defend it”.

Redknapp was called to the stand on the 8th day of the tax evasion trial, 1 February 2012.

“I always pay tax. I’d rather pay too much tax than not enough. I always pay my tax”, Redknapp said in court.

Redknapp admitted that he was “morally” due a bonus for the transfer of Peter Crouch and that the money paid into the Monaco bank account was not a bonus as it was “not in [his] contract”.

Redknapp also told the jury: “I’m a fantastic football manager. I have no business sense whatsoever unfortunately.”

During the cross examination Redknapp said that the bank account in Monaco only came to light because he had volunteered the information to the Premier League’s 2006 Quest inquiry into bungs in football.

The following day the prosecution put to Redknapp three times that the Monaco payment had been a bonus for the transfer of Peter Crouch, to which Harry gave the same answer: “Absolutely not”.

During the first week of the trial (23-27 January 2012) a recorded conversation between Redknapp and News of the World reporter Rob Beasley was played to the jury in which Harry can be heard saying: “That money was a bonus paid to me for selling a player”.

When asked by the prosecution as to why he told The News of The World that the Monaco payment was a bonus, Redknapp said that he only needed to tell the truth to the police and that “I wanted to get him [Rob Beasley] off the phone”.

“I’ve paid over £8 million income tax. Why are we bothering over £10,000 or whatever I’m said to have saved in tax?” Redknapp said.

“I’ve never broken the law and I wasn’t going to start doing something with Mr. Mandaric which wasn’t right. Not a chance”, he added.

Redknapp’s barristers closing speech in Southwark Crown Court on 6 February 2012 told the jury that the prosecution’s case didn’t “make sense” and that “it’s self evident that this only makes sense if Mr Redknapp is telling the truth”.

On Wednesday 8 February the jury rejected the prosecutions allegations that money paid into the Monaco ‘Rosie47’ account was a bonus for the transfer sale of Peter Crouch and a reward for Portsmouth beating Manchester United, clearing Harry Redknapp and Milan Mandaric on all counts of tax evasion.

21 months ago KinsellaTax predicted that Redknapp would ‘not be found guilty’ of tax evasion and that the chances of him being convicted by a London jury were ‘minimal’.

Click here to read our Harry Redknapp ‘not guilty’ prediction published in our May 2010 article ‘Possible Spring Trial for Redknapp’.

Redknapp is now the odds-on favourite to replace Fabio Capello as the next England manager who has just resigned from the position.

Outside of South Crownwark Court on 8 February, following being cleared on both charges of tax evasion, Redknapp said that the trial had “been a nightmare” and that the jury had been “absolutely unanimous that there was no case to answer”.

“It’s been five years and this is a case that should never have come to court because it’s unbelievable really…I’m pleased now we can go home and get on with our lives”, he added.

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