A college has been banned from entering into new deals with sub-contractors after an investigation revealed it did not know where 19 of its students were for six months.
The College of West Anglia contracted a company called GEMEG to provide a sports academy at Worksop Town Football Club in Derbyshire.
As well as football training, it would offer maths and english studies to 16 - 19-year-olds.
But the Education and Skills Funding Agency (ESFA) was called in after a number of allegations were made about the running of the programme.
GEMEG told the college training was being delivered in Nottingham for six months when it was, in fact, being delivered in Worksop.
When the college carried out a QA (quality assurance) visit to observe a maths session at a venue in Nottingham in February 2016, no students or tutor were available, according to an ESFA investigation report.
Later that month, GEMEG e-mailed the college to ask if students could transfer to the football club in Worksop.
But, the ESFA says five students it interviewed said they had attended the club since they started the programme.
'In addittion, all five students confirmed that they had never attended a venue in Nottingham,' its report adds.
'Registers submitted by GEMEG to CoWA stated training was delivered in Nottingham rather than Worksop, which meant that CoWA did not know where training was being delivered for the first six months of the programme.'
While the 19 students completed their course, none obtained a GCSE in maths or english.
GEMEG claimed £50,817 funding for the 2015/16 year. It said it paid £22,000 to the football club to cover the cost of facilities at the ground in Worksop.
But the ESFA report says: 'The club state they did not receive funds from GEMEG and are considering their options regarding this matter, including whether or not to refer the issue to the police.' The ESFA says there were 'significant weaknesses' in the effectiveness of management and control of GEMEG.
It has ruled CoWA must not enter into any further subcontracting arrangements until it has reviewed its procedures to the satisfaction of the ESFA.
CoWA principal David Pomfret said: 'This report relates to concerns dating back nearly three years about the practices of one of our sub-contractors. This sub-contractor was responsible for delivering courses on our behalf to a small number of students in the 2015-16 academic year. As a result of our own concerns, we ended our association with this provider in July 2016, long before any ESFA concerns came to light.
'At the time of the ESFA's investigation visit to CWA in November 2017, we had already implemented changes to our processes to address most of the perceived weaknesses and recommendations mentioned in the report.
'Since then, we have further strengthened oversight of sub-contracting delivery, which includes our own staff directly overseeing enrolment of 16-18 year olds and discontinuing non-local Study Programme sub-contracted delivery.
'We have also carried out a full review of subcontracting controls and assurance systems and processes and are confident these are operating effectively for all sub-contracted provision.'
The allegations surfaced when John Law, the Labour MP for Bassentlaw, Derbys, told a parliamentary debate 'a major scandal' was emerging regarding private companies running sports academies funded by the Department for Education.
'For example, a company called GEMEG, which operates in my area, is behind a football academy serving Worksop Town Football Club,' he said.
'We and the public were told that the company was run by Doncaster College, but when it collapsed, we found that it had been run by the College of West Anglia, which is 100 miles away.
'West Anglia claims that the operation took place for five months in Nottingham, but I can find no evidence that anyone ever went to Nottingham for five months. That involves 23 different students, and what I do know is that zero qualified in English and zero qualified in maths, and that the FA's safeguarding policies in schools were being breached.'
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