The chief executive of Northampton borough council and the borough secretary have been interviewed by police in relation to the £10.25 million loan to Sixfields, the BBC is reporting.
Council boss David Kennedy and Frances Fernandes, the authority's legal advisor, have faced questions over their role in the debacle in recent days, according to a report by the BBC's central investigations team,
BBC Radio Northampton has claimed both men were interviewed 'under caution', which effectively means the interviewee can choose not to say anything. It does not necessarily mean the interviewee has been arrested.
A spokesman for Northamptonshire Police would not comment directly on the BBC report.
He did, however, issue the following statement: "Northamptonshire Police are independently collecting evidence and investigating a wide range of matters concerning the grant, use and loss of Northampton Borough Council public funds.
"This search for the truth includes both making arrests and interviewing a wide range of individuals across many organisations. It should be noted that these interviews include both potential witnesses and suspects, and no assumptions should be drawn at this stage.”
A spokesperson for the borough council said there would be no comment due to the on-going investigation. The council spokesperson also stated that Mr Kennedy was currently on sick leave.
Northampton Borough Council loaned Cobblers £10.25 million to complete a stadium development between 2013 and 2014.
However, the stadium was never completed and the various probes have tried to establish exactly how the money was misspent.
A police investigation was launched in November 2015, but to date only former club chairman David Cardoza has been arrested in connection with the inquiry. He remains on police bail.
Mr Kennedy gave a public apology for his role in drawing up the loan agreement after a damning audit report was released last year.