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Richard Willis, the chairman, said: “The football club is not a piece of property like any other The directors were entrusted with looking after the club. Instead they threatened to kill it – and are now making a killing themselves.”It is understood that previous directors ran York according to the traditional principle of custodianship, not to make a personal profit out of it. The previous chairman, Michael Sinclair, who later converted to the priesthood, is known to have passed his 123,000 shares to Craig in 1992 for less than £1 each, not for a higher amount measured according to the value of Bootham Crescent for housing. Craig said this week there was no such tradition and that Sinclair had passed him the shares for “the market price”, although he would not say what the figure was. Apart from buying the shares, Craig did not have money or personal guarantees outstanding at York. He had previously loaned money but this was repaid in the late 1990s.The York affair has highlighted starkly the Football Association’s failure not only to protect its member clubs and their grounds, but even to uphold its own rules, few as they are. The FA has a rule specifically to protect football grounds from being sold for profit by people who have bought up club shares.

It is quite neat, providing that if a club is wound up and goes out of existence, then when the assets are broken up and sold, the proceeds cannot be swallowed by the shareholders. Instead they must be distributed to local sporting institutions or charities.In July 1999, Craig wrote to all York City’s shareholders seeking approval to bypass this rule. He said he and his fellow directors, Webb, Quickfall and Swallow, wanted to transfer the ground and all other assets out of the club and into the holding company, BCH, free of the FA’s rule. The club would be left with no assets, except membership of the FA and Football League. Craig’s letter said: “Your directors are concerned that in certain circumstances these [the FA's] provisions could adversely affect the ability of the company … to continue playing football at Bootham Crescent.”Craig and his fellow directors owned 94 per cent of the shares and the transfer duly took place. In a long interview with me this week, Craig failed to explain how the FA’s rule could be interpreted as set out in his letter.

The rule only applies to the distribution of assets when a club has already ceased to exist, so by definition it cannot stop that club playing at a particular ground in the future. Craig accepted that the reason for bypassing the rule was so that the shareholders could keep the money from selling the ground. “It is not acceptable in the modern era that if a club closes, its proceeds go to the FA or charity. The shareholders should have the right to the proceeds as with any business.”The FA has failed to respond meaningfully to the York scandal, which has disturbing implications for other clubs, many of whom make losses but sit on prime town centre sites. In January, I asked the FA’s chief executive, Adam Crozier, Nic Coward, who is responsible for the FA’s rules, and Paul Newman, the head of communications, why they maintain the rule but allow clubs to bypass it by forming holding companies None replied Crozier later told me he had asked Coward to reply. This week Newman did not return my call.Richard Willis, the supporters trust’s chairman, has been dismayed: “The FA have this rule, yet when it was bypassed they did nothing. They’re the governing body, but seem to have no powers, no beef, no teeth.”The trust has complained to the Independent Football Commission, the new toothless body set up to improve football’s “self-regulation”, and it remains to be seen what difference it can make.Craig’s justification for the carve- up was that the club, like so many, was losing money because of players’ wages and could not continue on its gates of around 4,000.

He believed it was “immoral and unacceptable” for clubs to “welch” on creditors by going into administration. Instead, he and his associates had offered the club for sale separately, it was bought by Batchelor, and continues to play at Bootham Crescent for now. He said the holding company had been “very generous” to the club.On the question of whether it would have served the club better for it to keep Bootham Crescent and any proceeds of sale, Craig said he did not believe the club could afford to service debts which would inevitably be incurred if the club builds a new stadium. Any money received from Bootham Crescent would therefore be worthless to it, he said. He said he did not know how much money he would ultimately make from selling the ground: “I haven’t had it valued.”John Batchelor has caused some stirs in his short time in charge of the club, which he runs in conjunction with his team in the British Touring Car Championship. Because that event is covered by ITV, he said he can attract national sponsors, like B & Q in the previous two seasons, whose money will subsidise the football club until next June, when expensive player contracts inherited from Craig’s regime come to an end.