The man accused of kidnapping Shannon Matthews told police her mother offered him money to look after the girl and threatened to set a gang of thugs on him if he declined.
Michael Donovan agreed to collect Shannon from school after he was approached by co-accused Karen Matthews, Leeds crown court heard today.
"She then asked me to take care of Shannon and again said there would be money in it for me," he said in a police statement read to the jury.
Then she threatened to "get three lads on to me", he told detectives, adding: "I know one of the people she mentioned had stabbed a man and killed him. I was frightened that if I didn't do it they'd come after me. I said 'OK, I'll do it'."
Shannon, then aged nine, was found by police in Donovan's flat having been reported missing from her home in Dewsbury by her mother 24 days earlier on February 19.
The prosecution alleges Donovan and Matthews hatched a plot to fake Shannon's kidnapping and collect £50,000 in reward money put up by national newspapers.
Donovan, 40, and Matthews, 33, deny kidnapping, false imprisonment and perverting the course of justice.
Donovan made his statements in his first interview at Halifax police station after his arrest. He said he had wanted to take Shannon back to her mother but "was frightened of the men".
In Shannon's second week with him, her mother rang to ask how she was. "She said the reward had gone up to £30,000. I thought from the news it was 25. She told me if it goes up to £50,000 she would ring me again," Donovan said, adding that he had no interest in the reward money but was frightened.
In her police statement, Matthews said she had only asked Donovan to take care of Shannon for a day while she broke up with her boyfriend, Craig Meehan. "I just wanted to know how to get him out of my life because I didn't love him any more. I asked Mike for advice," she said, adding that she asked him to take Shannon because she did not want the girl to be hurt by the break-up of the relationship.
"It just went pear-shaped. It didn't go to plan," she said. "I asked him if he'd take Shannon while I got myself sorted out."
Asked why Matthews rang the police to report Shannon missing, she said: "It was just to cover my own back, really, because Craig would have found out."
Matthews told detectives she did not know where Donovan lived and "didn't know him right much". Asked why she did not tell officers her daughter was with Donovan, she replied: "I wish I did now. I wanted to be strong for the children."
Matthews insisted Meehan was violent and frightened her. "He punched doors. When he hadn't got a door to punch he takes it out on me," she told police.
The trial continues.
