Founder of the now-defunct newspaper Today, Eddy Shah was arrested over allegations of having sex with an underage girl eight years ago.
The 67-year-old newspaper tycoon, now a property developer, who became popular for his conflict with print unions in 1980s, was held along with three men and a woman by the Metropolitan Police on Tuesday.
Eddy, who lives in Wiltshire, confirmed the news, but said he has been released on bail and no charges have been framed against him.
Metropolitan spokesperson said five persons have been taken into custody earlier this week under Sexual Offences Act 1956.
"Those arrested were a 63-year-old man from Kent; a 51-year-old woman from Kent; a 51-year-old-man from Kent; a 67-year-old-man from Wiltshire; a 62-year-old man from East Sussex. All of the alleged offences occurred before 2003," the spokesperson added.
The allegation is believed to be related to a woman in her 20s, who claims that she had sex with the men when she was between 13 and 15, reported The Independent.
The arrested woman is said to be the girl's mother.