Milan Mandaric told Harry Redknapp “there is no tax” when the football manager expressed concern over a Monaco bank account, a court heard today.
Redknapp claimed he confronted his then chairman after Portsmouth secured Premier League survival with an away win at Blackburn Rovers in 2004.
Redknapp thought it would be a good idea to raise the "investment" as they drank wine at an airport, the manager told officers in June 2009.
Mr Mandaric was said to have told Redknapp: "Harry, there is no tax. I've paid the tax. There is no tax for you."
Regarding the state of the "investment", Mr Mandaric was alleged to say: "Disaster, disaster. Got wiped out. There's still a little bit in there."
Redknapp told officers he did not press the issue as Mr Mandaric "wasn't a man to argue with", jurors at Southwark Crown Court heard.
The Tottenham Hotspur boss said during the interview: "I want my money paid here. If I don't go with, you know, I'm not going to get my money anywhere."
Redknapp went on to tell detectives that "Milan, not me" had control over the Rosie 47 account.
"He must have had control of that bank account, you know," Redknapp said.
Regarding finances at Portsmouth, Redknapp was said to have told police: "There was a big problem on cash-flow - the club was late on wages."
Both Redknapp and Mr Mandaric deny two counts of cheating the public revenue over
payments worth £189,000.
Earlier, John Black QC, prosecuting, said Redknapp "was feigning almost complete ignorance of its existence" as the Quest inquiry under former Metropolitan Police Commissioner Lord Stevens took place in 2006.
Mr Black asked jurors to consider whether "is it the case that Mr Redknapp could be unaware of the bank account" when he had flown out to Monaco just a couple of years earlier to set it up in the name of his dog, Rosie.
Despite two separate inquiries into his finances - the first launched in the wake of his receipt of a £300,000 "gift" after Rio Ferdinand signed for Leeds United from West Ham - Redknapp only registered the account to tax inspectors after his arrest in 2008.
Mr Black told Southwark Crown Court: "The existence of the bank account was not registered to Revenue and Customs for a period of six years, two months... after Mr Redknapp was first arrested and questioned in the course of this investigation."
Tax inspectors were informed of the bank account "only within the context to declare a small amount of credit interest" in 2008, Mr Black said.
Mr Black showed the jury of eight men and four women newspaper cuttings from 2003, which detailed Redknapp had received a £300,000 gift for the £18 million transfer of Ferdinand to Leeds United.
Redknapp - who had managed West Ham before joining Portsmouth - was said to have described the cash he received as a "personal present".
Mr Black said the fact Redknapp paid tax on the gift was proof he knew future payments would be tax liable.
Redknapp was accused yesterday of being a "hard-headed businessman" who, alongside co-defendant Milan Mandaric, obscured the money trail for years.
Redknapp first flew out to Monaco in April 2002 to set up the account, the Crown claims.
He named the HSBC account Rosie 47 - a reference to his dog's name and the year of his birth.
Mr Black said "both parties must have known" they were avoiding taxes. "These payments were a bung or offshore bonus that the parties had absolutely no intention of paying taxes for," he said.
PA