GENEVA - Swiss authorities say they have arrested the Chechen owner of Neuchatel Xamax, hours after the football club said it would file for bankruptcy.

Geneva prosecutors said in a statement Thursday that Chechen businessman Bulat Chagaev was arrested to prevent "financial mismanagement."

Prosecutors said a hearing was scheduled for Friday.

Chagaev, who denies wrongdoing, is at the centre of Swiss criminal investigations into suspected fraud.

Xamax was stripped of its license last week because of suspected fraud and a failure to prove it could meet its financial obligations.

Its debts are estimated at between 8 and 10 million Swiss francs ($8.7-10.9 million).