Portsmouth chief executive Peter Storrie has been charged with tax evasion over a 2003 transfer deal, Britain's Revenue and Customs Prosecutions Office (RCPO) said on Wednesday.
Storrie is accused of defrauding Britain's tax office by concealing the payment of a signing-on fee made to Senegalese midfielder Amdy Faye when he joined from French club Auxerre, an RCPO spokesman said.
The full charge said that he "cheated the public revenue" by arranging for the fee to Faye to be paid via bank accounts of an agent, William McKay, in order to evade the payment of tax and national insurance contributions.
Storrie is to appear at London's City of Westminster Magistrates Court on November 16.
In a statement, Storrie said he was astonished at the decision to charge him and that he had not played a direct role in the deal to sign Faye, according to media reports.
"At the time negotiations to acquire this player were concluded, Mr Storrie was on honeymoon," the statement said.
"Mr Storrie will defend the allegations in the strongest possible terms and is entirely confident that he will be exonerated not only of the allegation of cheating the public revenue, but any suggestion that anything untoward took place concerning any transfer dealings in which he was concerned."
The RCPO said there was no maximum penalty for the offence, meaning that, should he be found guilty, the court could give whatever sentence it believed to be fitting.
Portsmouth are bottom of the Premier League after just two wins and a draw from their opening 11 games.
Last week the south-coast club were banned from signing any new players because of unpaid debts to other clubs.