THE UK's largest law firm Clifford Chance is considering taking legal action against The News The World over a story alleging a solicitor had been arrested for possession of cocaine after a police raid on the firm's London offices.

The story, which appeared in 24 March edition of the tabloid newspaper, has been described by Clifford Chance as “grossly defamatory” of the firm and “wholly untrue”.

In a specially prepared press statement the firm denied any allegation that a Clifford Chance employee had been found in possession of any drug.

It did confirm, however, that an employee of the firm's catering contractors had allegedly been found in possession of cannabis.

The City of London Police has spoken to three people in connection with its inquiries.