Liverpool have registered their disappointment at "unfounded allegations" released in a statement by Bobby Duncan's agent, Saif Rubie, which accused the club of "mentally bullying and destroying the life" of the player.
The 18-year-old, who wants to leave Anfield in search of regular game time, has been the subject of loan offers from Fiorentina and FC Nordsjaelland.
Liverpool turned down proposals from both sides, which they felt were unsatisfactory and that prompted Rubie to post a statement on Twitter which referenced that one of the club's "greatest-ever players Steven Gerrard happens to be Bobby's cousin," the teenager's "very small salary" and and added that Duncan "will never go back to Liverpool again."
The statement contains an accusation that Liverpool and their sporting director Michael Edwards have been "mentally bullying and destroying the life of a young man."
It also claims they "have even gone as far as saying in writing that they will punish him and make him stay until January and beyond to teach him a lesson."
A spokesman for the club said: "Liverpool FC is aware of and disappointed by the unattributed comments and unfounded allegations that have been made in the media regarding one of our players.
"As the interests of the player in question are not best served by either inaccurate speculation, inflammatory statements or public discourse, we will be making no further comment.
"We will, however, continue our efforts to work privately with the player to find a resolution in the best interests of all involved."
Duncan, who had been with Manchester City since the age of 11 before joining Liverpool in August last year, is highly regarded by the first team staff at Melwood as well as those he has worked with at the Academy in Kirkby.
Former Liverpool Jamie Carragher, who knows Duncan and his family well, became embroiled in a heated Twitter exchange with Rubie on Wednesday afternoon. He advised Duncan to dispose of the agent's services.