Birmingham City could be facing a fire-sale both on and off the pitch if owner Carson Yeung is convicted of money-laundering.
The future of the Championship club looks in serious doubt after the businessman heard five charges against him totalling ?59million in a Hong Kong magistrates' court.
According to laws concerning the seizure of assets, Birmingham's owner could serve a 14-year jail term and, as a consequence, may be stripped of his shareholding.
In the spotlight: Mr Yeung sits in a police van heading to a court in Hong Kong
That would leave the St Andrew's clubin a perilous position, with the ensuing financial uncertainty likely to force them into hawking off players in a bid to raise cash.
The exit of Craig Gardner - for a knock-down ?6m to Sunderland - was last night confirmed and sales of stars such as Roger Johnson, Scott Dann, Cameron Jerome and Ben Foster now cannot be ruled out.
Yeung appeared in court yesterday before being released on bail on the condition that he surrendered his passport. The case was adjourned until August 11.
The accusations concern ?59m that waspaid into bank accounts during a six-year period from 2001. A conviction could have far-reaching and damaging effects, for him and theclub.
Sold: Midfielder Gardner joined Sunderland in a ?6million deal on Thursday evening
Rules governing the proceeds of crimemean his stake in the holding company, Birmingham International Holdings, would almost certainly be taken from him.
His 23 per cent stake in the club could be sold for less than the ?81m Yeung paid to take over from David Sullivan and David Gold in October 2009.
That will put acting chairman Peter Pannu under pressure from investors keen to protect their stake - and could trigger a glut of big-name sales. The authorities in Hong Kong arecommitted to smashing money laundering and have signed up to cross-border agreements.
Bernd Ratzke, partner in top legal firm Boodle Hatfield, said: 'If Yeung and Birmingham International Holdings were subject to UK laws, the authorities could act under the 2002 Proceeds of Crime Act.
Yeung appeared in court to face charges of 'dealing with property known or believed to represent proceeds of an indictable offence'
'If Yeung has acquired his stake in Birmingham City from criminal proceeds and this matter came before the UK courts, the Asset Recovery Agency could apply for an expropriation order which would strip Yeung of his shareholding. His stake would then be sold and the money kept by the Government. It appears that parallel legislation is in operation in Hong Kong.'
The saving grace for the club at present is that Yeung's trial looks some way off, thanks to the complex financial details.
Birmingham have told UEFA they will play in the Europa League next month, which will change only if they areforced into administration. Their latest accounts to June 2010 show a ?24m black hole, which will have worsened since they were relegated.
A spokesman said: 'There is no reason to suggest the participation of Birmingham in the Europa League should be in doubt because one of their shareholders has allegedly committed personal improprieties, especially when they apparently relateto a time when he was not involved with the club.'
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