David Conn: New year and new regime – same old problem

Before he was condemned as too flighty to be the chief executive of the Football Association – although he is apparently deemed thorough enough for the nation's postal service – Adam Crozier had concluded that the FA needed a firmer hand on football's turbulent finances.

He promised competent regulation and a proper compliance regime, and, while some doubted his commitment and grasp of detail, he assured me personally last August that, before the end of this year, the FA would finally introduce some rules long urged upon it: that anybody seeking to take over or be a director of a club would have to be "fit and proper" to hold such a position. Proposed explicitly by Sir John Smith, the former deputy commissioner of the Metropolitan Police, in his report following "bungs" allegations in 1997, this common-sense measure was also recommended in late 1999 by a majority of the Government's Football Task Force, which called for tighter controls just as the game began to plunge into crisis.

Now, Crozier is gone and the FA is being jointly run by the public relations man David Davies and Nic Coward, the head of compliance, whose attitude to financial regulation has at times seemed no stronger than laissez-faire. Barring shocks this Tuesday, we can safely assume that Crozier's clear assurance will pass unfulfilled. Another year gone with historic football clubs traded like fourth-hand old bangers, and, with most Nationwide League clubs currently open to offers, further regular sales can be expected next year with no questions asked by the governing body.

Sir John, who was asked by the FA itself to examine its financial regulations following scandals over bungs and betting, was shocked to discover how open to abuse the game and its clubs were. "The FA's rules," his report concluded, "are insufficient to allow for proper regulation of football's financial affairs."

He wrote eloquently about how and why football and its traditions are so beloved by so many, and recommended the FA set up a compliance unit, "the prime responsibility of which would be to oversee the game's integrity and reputation." Despite recent reports that such a "compliance unit" is currently inquiring into Aston Villa's transfers under their former manager John Gregory, in fact no such unit exists. The FA has a compliance department, headed by Coward, which now includes a head of compliance, Steve Barrow, alongside Graham Bean, the former Barnsley detective and chair of the Football Supporters Association.

Last year, Coward told a conference of Supporters Direct, the Government-backed initiative to encourage fans to form trusts and become more involved in their clubs, that many chairmen of Football League clubs have "trouble with cash" – counting it, and accounting for it. Nevertheless, his team, which goes into clubs to examine accounts, was deliberately downgraded in name to the "Financial Advisory Unit", because it would be friendlier for the club chairmen to whom the unit reports. The reports, according to some who have seen them, regularly find that clubs are technically insolvent, which could mean the directors are committing a criminal offence by continuing to trade. Yet nothing is demanded of the clubs by the FA and the directors are free to ignore every word of every report.

The Task Force conducted a long, well-informed study of football's vulnerability to financial abuse, made all the more tortuous by the fact that the membership, alongside supporters groups, academics and Sir John himself, included the FA, Premier League and Football League, who set their faces against any kind of regulation and scoffed at the notion of a "fit and proper person test". The clear majority of the Task Force came to agree with Sir John's conclusions, arguing that the FA needed a modern body of rules which could deter profiteers and asset strippers, protect fans as consumers and ensure that those who became involved in clubs did so in order to be, in the game's traditional parlance, "custodians" for the future. Their report was opposed by the authorities, who rejected "additional layers of regulation", saying: "The freedom to act is key to the excitement and unpredictability of football competition." The majority's report included this unambiguous recommendation: "[The FA] should introduce a requirement that any persons wishing to own a substantial number of shares in a football club be 'fit and proper persons' to do so. Such a qualification would include scrutinising such matters as criminal record, business record, record of employment etc"; it should include a requirement "that such a person is motivated by a desire to act in the best long-term interest of the club".

Crozier took over at the FA in January 2000 and so, happily for him, missed out on the tedium and confrontation involved in the Task Force process. The Government then took a year to decide that, although the authorities were in the minority, their approach should be allowed – namely no new regulation at all but the establishment of the Independent Football Commission, a body with no actual powers, whose first annual report is expected shortly. One Task Force member who shouldered a huge amount of work generating the proposals for the majority report is now unshakably of the view that the whole process was a waste of time.

Crozier was a commercial, rather than compliance, breed of executive, but he did come late to the conclusion last summer that the FA should indeed introduce a "fit and proper person test", which was pressed upon him in meetings with football supporters' groups. David Burns, the then chief executive of the Football League, had reached a similar conclusion, after seeing at first hand the perennial crises of clubs and the sharks often waiting to gobble them up.

The FA's bureaucracy, led by Coward, could not be accused of leaping rapidly into action. Crozier told supporters' groups that the FA was preparing to send the project out to law firms for tender, but gave no further details. Dave Boyle, the vice-chairman of the Football Supporters' Federation, e-mailed the FA and Coward personally in September and October to ask what was happening, but received no reply.

"Another year has gone by," Boyle said this week, "but after they finally promised to do something, still the FA is failing on this issue of core concern to fans, that clubs, which are more vulnerable than ever, should be protected from people who will rip them off or run them into the ground."

As there is no current "fit and proper person" requirement, it is impossible to say who would be caught by it. Fulham are owned and run by Mohammed Al Fayed, who is deemed unfit to be a citizen of this country, but that is not to say the FA would be concerned about him owning one of its clubs. John Russell was convicted of two counts of obtaining property by deception in March 1999 and given a 15-month suspended prison sentence, but this was no bar to his continuing to own and be chairman of Scarborough, whom he left in an Insolvency Act voluntary arrangement with creditors, or then moving on to Halifax Town or, Frickley Athletic. He is currently co-chairman of Exeter City with Uri Geller, the celebrity spoon-bender. Majority owners of two other clubs cannot be named in this context at present because they have criminal trials coming up, one related to the football club, one to activities before he took over.

Boyle rightly said that the proven crooks who might take over clubs are far outnumbered by those who might prove to be incompetent, or have madcap ideas which ultimately crash in failure. He said: "The strict rule on probity should be combined with a process whereby people wanting to take over a club are simply asked for a chat with the governing body, to present their plans, and business models, for the club. At that stage, the wider circumstances of the club could be scrutinised and people or plans which are not up to it could be weeded out."

But, despite two official reports and a clear promise from the chief executive, another year is over and still anybody can take over a football club: crooks, bankrupts, chancers, con-men, wheelers, dealers; the mad, the scheming, narcissists, exhibitionists, small-town megalomaniacs and tinpot dictators. Alongside, of course, democratic, mutual, supporters' trusts, one of the successful legacies of the Task Force, and the still steady trickle of good eggs, preferably locally reared and hard-boiled. There's a cheery thought for the new year.

davidconn@independent.co.uk