Specialist sex crimes investigators in England are looking into an allegation that Mohamed al Fayed sexually assaulted a teenage girl.
The Harrods owner yesterday vehemently denied the claim after he was interviewed by police under caution.
Scotland Yard said the inquiry is being led by Operation Sapphire, a specialist unit set up in 2001 to investigate sexual offences.
Mr al Fayed voluntarily went to a west London police station yesterday morning to answer questions about the alleged incident in May.
His spokeswoman, Katharine Witty, said he was “confident” his name would be cleared.
Mr al Fayed was not forced to attend the police interview, which lasted less than half an hour.
It is understood the allegation relates to a complaint by a 15-year-old girl that the multi-millionaire businessman sexually assaulted her at Harrods.
The teenager told police Mr al Fayed kissed her after she met him at the exclusive Knightsbridge store while shopping with her mother, the 'Mail on Sunday' reported earlier this year.
In a statement outside Harrods yesterday, Ms Witty said: “We confirm that Mohamed al Fayed voluntarily attended an interview with police to categorically refute an allegation widely reported in the media.
“He did not attend under compulsion and the meeting lasted for less than half an hour.
“From the outset, details of this allegation have appeared in the media which they attributed to a police source.
“And indeed despite assurances that today’s interview would be kept confidential, he is concerned that it was reported within one hour of its conclusion.
“Mr al Fayed vehemently denies this allegation and is confident that his name will be cleared.”
Scotland Yard refused to confirm that the Harrods owner had been questioned.
A Metropolitan Police spokeswoman said: “A man attended a west London police station by prior arrangement and was questioned under caution this morning.
“The man was questioned in relation to an allegation of sexual assault on a girl under 16 at a business premises in central London. The allegation was received in May 2008.”
So far there have been no arrests, the police spokeswoman said.
Egyptian-born Mr al Fayed, who also owns Fulham Football Club, has frequently clashed with the British establishment.
Despite living in Britain for decades, he has repeatedly been refused a UK passport.
This year an inquest rejected his claim that Princess Diana was killed by intelligence agents because she was pregnant with his son Dodi’s child and they were about to announce their engagement.