Watford are under investigation from the English Football League following allegations they supplied false financial documents during their 2014 takeover.
The Daily Telegraph’s report on Monday claimed the club forged a banking letter during Gino Pozzo's takeover of the Hornets, where he assumed complete control of the club from his father Giampaolo.
The EFL have launched a full investigation, as the Hornets were a Championship club at the time, and they could hand down a hefty fine or even a points deduction should the allegations be found true.
An EFL spokesman said: "We can confirm, following receipt of information from the Daily Telegraph, that we immediately commenced a disciplinary investigation into serious allegations made against Watford Football Club.