Glitter was released on bail some 10 hours later. But the arrest - the first to be reported in the case - widened a scandal that has already damaged the reputation of the publicly-funded BBC and the legacy of Savile, a former DJ who was one of the broadcaster's top show hosts and a prolific charity fundraiser.

The head of the BBC's governing body said on Sunday the broadcaster's reputation was on the line, and promised to get to the bottom of the scandal.

A police statement said a man in his 60s had been picked up just after 7 am (0700 GMT) on suspicion of sexual offences in the investigation termed "Savile and others". The statement did not name the man and a spokesman declined further comment.

The BBC and Sky News identified the man picked up from his London home as Glitter, a 68-year-old who was popular as a glam-rock singer in the 1970s.

Footage on both broadcasters showed Glitter, who was wearing a hat and sunglasses and was not handcuffed, leaving an apartment in central London and being driven away. Hours later, television showed investigators carrying large black bags as they left the house.

Glitter was held by police for about 10 hours. He was seen leaving a police station in central London and, minutes later, return to his apartment, where he dodged questions by scores of waiting reporters and cameramen.

Police later said the man was "bailed to return to the police station in mid-December 2012, pending further inquiries".

Glitter, born Paul Gadd, shot to fame in the early 1970s with the hit "Rock and Roll", trademark figure-hugging shiny silver all-in-one suits, platform shoes and large black hair.

Glitter served two months was jail in Britain in 1999 for possession of child pornography. He then moved to Cambodia, but was deported in 2002 due to suspected sex offences.

In 2006, a Vietnamese court convicted him of committing obscene acts with two girls aged 10 and 11 and sentenced him to four years in jail. On his release he returned to Britain.

Allegations that Savile sexually abused young girls for decades first emerged in an expose on the British TV channel ITV. Since then, police say some 300 victims had come forward.

Victims' allegations broadcast by ITV include claims from one woman that she had seen Glitter having sex with an underage girl in Savile's BBC dressing room while Savile abused another girl. Glitter has denied the claim, according to the BBC.

With the scandal widening, public outrage has increased. A cottage in the Scottish Highlands that belonged to Savile was vandalized overnight, with abusive slogans painted on its walls, local police said.

BLIND EYE?

The scandal has raised troubling questions about the BBC's management and its past workplace culture. Revelations that an investigation by Newsnight, the BBC's flagship TV news show, was shelved last December led to claims bosses at the broadcaster knew about the allegations but kept quiet.

"Can it really be the case that no one knew what he was doing? Did some turn a blind eye to criminality?" asked Chris Patten, chairman of the BBC Trust which oversees the broadcaster, writing in the Mail on Sunday.

The Sunday Times said the office of former BBC director Mark Thompson was alerted about the allegations twice, in May and September. Thompson is poised to take over as chief executive of the New York Times, and the Sunday Times quoted his spokesman as saying Thompson had not been told about the allegations on either occasion.

Thompson has told Reuters that he did not know about the nature of the investigation by the Newsnight program into Savile, and had no involvement in the decision to axe the report.

The BBC said on its website on Sunday that "Thompson has said the first time he had been made aware of claims that Savile had committed serious crimes and that some had taken place while the entertainer was working at the BBC was after he stepped down as director general".

The broadcaster has announced two investigations as a result of the scandal, and Patten promised full cooperation.

"The BBC's reputation is on the line," he wrote. "The BBC must tell the truth and face up to the truth about itself, however terrible."

When Savile died in October last year aged 84, his gold coffin went on public display and he was lauded as a "national treasure" who had raised millions of pounds for good causes.

A year later, police describe him as "undoubtedly" one of Britain's most prolific sex offenders, and the Vatican said a papal knighthood given to Savile decades ago for his charity work "should not have been bestowed".

Savile's family said it was in despair over the allegations and offered its "deepest sympathy" to abuse victims. It also said it had decided to remove the headstone on Savile's grave and destroy it to avoid it becoming a target for vandals.

Justice Secretary Chris Grayling on Sunday rejected a call by the deputy leader of the opposition Labour party for an independent, over-arching inquiry, arguing that such a process risked taking much longer to get to the truth.

Grayling told the BBC that efforts should focus on finding anyone involved in abuse alongside Savile and bringing them to justice.

(Editing by Jon Hemming)

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