Police said inquiries had revealed a number of frauds allegedly committed between December 2013 and April 2020.
Day has been taken to Waverley Police Station and is expected to be charged with fraud-related crimes.
Day and Sebastian worked together for more than 11 years and parted ways in November 2017.
"After 12 great years together I'm very sad to be losing Guy as a client," Day said in a statement at the time.
"But he is a wonderful talent and a good person, so I wish him well in everything he does."
Day's celebrity talent agency, 6 Degrees Management, went into liquidation in July last year.
https://news.google.com/__i/rss/rd/articles/CBMilgFodHRwczovL3d3dy45bmV3cy5jb20uYXUvbmF0aW9uYWwvdGl0dXMtZGF5LWd1eS1zZWJhc3RpYW4tZm9ybWVyLW1hbmFnZXItYXJyZXN0ZWQtYWxsZWdlZC1mcmF1ZC1zeWRuZXktY3JpbWUtbmV3cy9lMjliNWVmZS0xMGQyLTQ0NjYtYTdjYS02OWQwZWM0Yzg5ZjjSAUVodHRwczovL2FtcC45bmV3cy5jb20uYXUvYXJ0aWNsZS9lMjliNWVmZS0xMGQyLTQ0NjYtYTdjYS02OWQwZWM0Yzg5Zjg?oc=5
2020-07-01 11:39:13Z
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