Celje police confirmed that one person had been detained and that they were conducting several house searches in and around Celje and Ljubljana as part of an investigation into abuse of office.
The arrest follows reports that Špan, along with former Hypo executive Anton Romih and the former head of Hypo Leasing Andrej Potočnik, had received about EUR 10m on their personal offshore accounts in deals with Vegrad.
Vegrad reportedly paid millions in commission to Liechtenstein-based firms affiliated with the Hypo managers in real estate purchases involving Hypo Leasing.
The trio had been axed in February 2011 in a blitz action carried out by the bank's owners with the help of security guards from Austria.
They are reportedly suspected of wrongdoing on a massive scale. A document by the Austrian parent bank obtained by the business daily Finance mentioned "fraud, corruption, unlawful property gains and gross negligence".