Liverpool forward Craig Bellamy is reported to be facing an £80,000 fine following allegations of a training-camp bust-up with team-mate John Arne Riise.
Manager Rafael Benitez yesterday announced he would punish any players found to have breached club rules during a four-day training trip to Portugal last week.
Controversial striker Bellamy is believed to have been at the centre of the storm with one report claiming a drinking session on Thursday ended with the Welshman attacking Norwegian Riise.
There have also been reports of a separate row involving Jerzy Dudek, Robbie Fowler and Jermaine Pennant while the squad stayed at the Algarve resort of Vale do Lobo.
Eye-witnesses have claimed that police were called to the resort during a noisy disturbance. June and Peter Lover, a retired couple from Harrogate, looked out from their apartment window after being woken up at 1.30am.
Mrs Lover told The Times: 'There must have been at least five police vehicles and a dozen police under our window. The noise was terrible and we simply couldn't sleep through it.
'At first it seemed like late-night revelry and we knew the Liverpool squad were downstairs. But then things seemed to get out of hand and the police arrived.'
Mr Lover added that he saw one player handcuffed before being released.
He said: 'He kept telling the police how much he loved them, as if he was pleading to be allowed to go free.
'At one point, the police seemed to be slapping him around the face, trying to bring him round and sober him up because he was so drunk. He kept apologising over and over again but the police did not want to know.
'It was only after a while that the police found someone from the Liverpool management, who managed to calm things down and talk quietly.
'We have many teams around the complex and there is usually no trouble at all, but this was not a pleasant experience.'
The matter has overshadowed Liverpool's preparations for their Champions League tie at Barcelona on Wednesday but the club have insisted training has gone well.
'The players worked extremely hard at last week's training camp, but we will take disciplinary action and fine any of them who are found to have breached club rules during our stay in Portugal,' Benitez said yesterday.
'I've told the players this and they understand and accept the decision I have taken.
'Despite reports to the contrary, the spirit amongst the lads is very good with everyone looking forward to the game against Barcelona on Wednesday.'