Investigators have been examining the relationship Sports Direct founder Mike Ashley had with Iceland's banks

close links between the bank and one of its major clients and investors was key to the 2,300-page report ordered by the Icelandic parliament.


Loans: Investigators have been examining the relationship Sports Direct founder Mike Ashley had with Iceland's banks

SFO investigators have been examining the relationship Sports Direct founder Mike Ashley had with Iceland’s banks.

The Newcastle United chief was a depositor there and the SFO examined whether he might also have taken out loans. It is not known whether he withdrew money from Kaupthing before it collapsed.

Investigators also want to know whether Chris Ronnie, the former chief executive of rival JJB Sports, may have indirectly received money from any loan to Ashley.

Kaupthing financed Sports Direct’s acquisition of stakes in Blacks Leisure in 2006, and JJB two years later.

The bank also advised Ashley on his 2007 acquisition of his football club.

Sports Direct denied that anyone connected with the firm was an SFO target.

A number of other leading figures in British commerce are also under investigation. The SFO is looking at why some of Kaupthing’s clients were able to take large loans backed with minimal collateral and deferred interest payments.

It has discovered that Kaupthing moved its operations to the UK after backing from Russian oligarchs ran dry. Despite this background, the Financial Services Authority gave the bank a licence to offer deposit accounts to British savers. It still owes the UK Treasury £2.5billion.

CHAMPAGNE BASH PUT ON ICE BY BILLIONAIRE
Vincent Tchenguiz abandoned a lavish party on his super-yacht last night as he faced a major inquiry into his links with collapsed Icelandic bank Kaupthing.

The billionaire investor was expected to host a champagne bash on the £10million Veni, Vidi, Vici during the high-profile Mipim property jamboree in Cannes.

But the social event was quietly cancelled while the 54-year-old spent the day in a ‘war cabinet’ in the boardroom of his opulent Mayfair mansion with a team of solicitors and financiers to discuss the consequences of the investigation, following his arrest on Wednesday.

Mr Tchenguiz broke off from his meeting to speak to the Daily Mail at his £2million home behind the American Embassy in Grosvenor Square. He said: ‘I cannot really comment on the arrest. There are no charges.

‘You are aware we have a civil action pending and it may well be linked to that. But I cannot say any more.’

The Icelandic report identified Robert Tchenguiz as ‘the largest debtor’ in Kaupthing as well as a shareholder in Exista, an investment company that was the biggest shareholder in Kaupthing.

Robert, 50, had borrowed a staggering £1.7billion and the report noted: ‘The big increase in loan facilities to Tchenguiz from January 2007 until October 2008 is noteworthy, in light of the fact that in late 2007 many of Tchenguiz’s companies started going downhill.’

It also pointed out that the bank  continued to lend him money to repay loans being demanded by other banks.

It said: ‘It seems that the boundaries between the interests of the banks and the interests of their biggest shareholders were often blurred and that the banks put more emphasis on backing up their owners than can be considered normal.’

The fraud office will call on many of the 30,000 individuals and organisations who lost a collective £2.4billion to give evidence.

The Tchenguiz arrests are thought to be the tip of the iceberg.

Both deny any wrongdoing, saying in a joint statement this week: ‘We were arrested earlier this morning [Wednesday] and are being questioned with regard to matters relating to our relationship with Kaupthing Bank.’