Harry Redknapp has privately admitted that his chances of succeeding Steve McClaren as England head coach have been dealt a mortal blow by his arrest on Wednesday as part of police investigations into corruption in football. A source close to the Portsmouth manager described Redknapp as “devastated” and certain that the FA “will not go near” him now.

As the highest-placed English manager in the Barclays Premier League, Redknapp had been linked with the England job by an increasing number of pundits since McClaren’s dismissal last week. His odds of getting the call from the FA had been as short as 9-2 on some betting websites before the arrest, but had dropped to as long as 25-1 yesterday. Redknapp is understood to be “suspicious” of the timing of the arrests and has questioned the need for police to adopt the methods they did.

Redknapp had been watching a match in Germany on Tuesday evening and returned to England yesterday to discover that Sandra, his wife, had been woken at 6am by police, who searched their house in the Sandbanks area of Poole, Dorset. Photographers from The Sun, for which he writes a column, had been alerted, which added to his displeasure.

Redknapp was later arrested by officers from the City of London Police on suspicion of conspiracy to defraud and false accounting and questioned at Chichester police station, although he has claimed that only a single payment from an agent to a player was discussed.

Peter Storrie, the club’s chief executive, Milan Mandaric, the former Portsmouth chairman who is now owner of Leicester City, Willie McKay, the football agent, and Amdy Faye, the Senegal and former Portsmouth midfield player, were also detained on the same charge. Mandaric was also arrested on suspicion of money-laundering. All are on police bail until February.

At a press conference at the Portsmouth training ground yesterday, Redknapp, true to form, decided that attack was the best form of defence as he spoke of his family’s “bitter disappointment” at the events of Wednesday. “I could just have got a phone call and been asked to pop down to the police station and have a chat about it,” he said. “Why it had to be brought into the public domain and made such a big issue, I still find difficult to believe.

“Peter [Storrie] works at this club and you would not get a more honest or straighter guy than him. He is on the FA international committee and deserves that for the hard work he puts in. Milan [Mandaric] was the man who came in and saved this football club. This club is completely transparent and totally honest. There is nothing that goes on at the club that shouldn’t, or that we are afraid of.”

Storrie said in a statement yesterday: “Portsmouth Football Club have always co-operated fully but are concerned about the way this investigation has been handled concerning a matter dating back to 2003.”