Dario Gradi’s long career could be ending in disgrace after an independent inquiry into the football sexual‑abuse scandal concluded that he had information that might have stopped one serial offender who is now feared to have preyed on more than 25 victims.

According to the findings of a two-and-a-half-year investigation, Gradi failed to report Eddie Heath when they worked together at Chelsea in the early 1970s despite receiving a complaint that his colleague had indecently assaulted one boy in the showers.

Instead, Gradi, as Chelsea’s assistant manager, visited the boy’s parents and admits in his own evidence that he did not want the matter to go any further. “I’d got no intention of getting Eddie Heath into trouble,” he says.

Heath, the club’s chief scout, went on to abuse boys for many years, with 23 complaints from boys within Chelsea’s youth system, one from a school team and another relating to when he was working for Millwall.

Gradi, currently suspended by the Football Association and also facing significant questions about the Barry Bennell scandal at Crewe, has subsequently been accused by Charles Geekie, the QC who was appointed by Chelsea to oversee the inquiry, of giving “somewhat unlikely and unconvincing” evidence.

“Mr Gradi is the single example of a clear account of an adult in a position of responsibility being informed about an allegation in relation to Mr Heath,” Geekie’s 252-page report states. “The complaint … was not referred to more senior members of the club and an opportunity to prevent Mr Heath from going on to abuse others was lost.

“The very purpose of this review is to shine a light on matters such as this. The events involving Mr Gradi are central to the purpose of this review. There is, I consider, a significant public interest in matters such as this being brought fully and openly into view. I consider it absolutely necessary … to name Mr Gradi.”

It can also be revealed that:

• Chelsea’s inquiries have revealed complaints of non-recent sexual abuse relating to three other employees – one a driver and two scouts – at Stamford Bridge.

• Heath had a close friendship with another paedophile, John Butcher, and they worked together as scouts for Chelsea.

• Geoff Hurst, one of England’s heroes from the 1966 World Cup, refused to cooperate with the inquiry, despite having been manager of Chelsea when Heath was sacked in 1979.

• Chelsea have found “substantial evidence” in a separate inquiry that Gwyn Williams, formerly their academy director, subjected young black players to racist remarks “on a routine basis”.

Facebook Twitter Pinterest Eddie Heath, formerly Chelsea’s chief scout, went on to abuse boys for many years, with 23 complaints from boys within the club’s youth system, one from a school team and another relating to when he was working for Millwall. Photograph: Nick Potts/PA

Gradi, awarded an OBE in 1998 for his services to football, has always denied any wrongdoing since the Guardian’s investigation into sexual abuse in football began what the FA chairman, Greg Clarke, has described as the biggest crisis in the history of the sport.

However, it is difficult to see any way that Gradi, 78, can return to the sport now it has been established Crewe’s director of football, still on full pay after being suspended by the FA in December 2016, had been told about a colleague at Chelsea committing a sex act on one boy and decided, according to Geekie’s report, not to report it.

In his evidence, Gradi was asked to clarify what the complaint was. “I don’t remember the detail but … he [Heath] didn’t rape him or anything. He was sexually, I don’t know, touching him, I suppose. I don’t remember. I don’t remember being horrified by it, thinking it was awful, but sorry.” He could recall telling the boy to keep away from Heath and that his colleague had been accused of “touching him where he shouldn’t have been touching him”.

He could also recall offering to “keep an eye” on the boy from that point onwards, adding: “I probably said something along the lines to partly defend Eddie Heath … well, he was good with the kids, he’d got a way with the kids and he liked being with the kids and they seemed to like being with him. To be quite honest, I think I would have tried to stand up for Eddie Heath a bit.”

Gradi, who went on to manage Crewe in more than 1,000 games, also stated in his evidence that, having left the family home, he did decide the complaint was serious enough to mention it to Ron Suart, who had taken over as manager. However, that could not be corroborated because Suart died in 2015 and Geekie makes it clear in his report he does not accept that version of events.

Instead, Geekie says he believes the evidence put forward by the boy, now in his 50s, and the boy’s father, who had written a letter of complaint to Chelsea and was left with the impression that Gradi was “defending what had happened”. Gradi’s account states that the father repeatedly told him he did not want to get Heath in trouble and that “took the pressure off me, as far as I was concerned”. Informed of that, the father responds: “Why did I send the letter?”

Heath was responsible for identifying some of Chelsea’s leading players – including Ray Wilkins, Gary Locke, Steve Wicks, John Bumstead and Tommy Langley – during more than a decade at the club. However, he was also using his position to prey on young boys and was never prosecuted or investigated before dying in 1983, at the age of 54.

In his findings, Geekie says there were no safeguarding arrangements in place at Chelsea at the time. “However, Mr Gradi received a specific complaint from a father and son as to conduct by Mr Heath that they considered to be disturbing. There is no ambiguity or lack of detail about the matter he was dealing with. It must have been as plain to Mr Gradi as it is to me that he was being presented with a matter of seriousness and a matter that would not have been raised lightly. It needed to be taken seriously.

“Mr Gradi should have reported the matter to more senior staff. I have rejected his claim that he did so. Given the striking, and clearly memorable, nature of the event, this was a significant personal failure by Mr Gradi. It was a lost opportunity to expose Mr Heath and prevent further abuse.”

Geekie goes on to state there was no evidence to support Gradi’s assertion, more than 40 years after the event, that the boy was “blaming the sexual stuff going against him as a footballer”.

Geekie led a 17-strong legal team that dealt with eight police forces and conducted 139 interviews before reaching their findings. Chelsea’s chairman, Bruce Buck, has met 17 of the victims, hearing evidence that brought him to tears on more than one occasion.

A club statement read: “The board wishes to thank all the survivors and witnesses who came forward to assist the reviews and the club apologises unreservedly for the terrible past experiences of some of our former players.”

Chelsea, who are now facing a number of compensation claims, commissioned Barnardo’s to oversee the investigation into allegations that there was a culture of racism and bullying within the club’s youth structure throughout large parts of the 1980s and 1990s.

The final report, delivered simultaneously with Geekie’s findings, states that “numerous examples were given of GW [Williams] humiliating and ridiculing black players by making racially derogatory remarks about them”.

Williams, who had a 27-year association with the club, gave evidence that he was not racist and described the evidence against him as “biased, untrue, unfair and artificial and part of a concerted effort to scapegoat”.

Graham Rix, Chelsea’s former youth-team coach, was also investigated, though some of the players relevant to his case were not interviewed. The Barnardo’s team “takes the view that, while it appears GR [Rix] could be aggressive and bullying, on the evidence presented to them, he was not racially abusive”.

Rix has always denied the allegations that were made against him and told the inquiry, via his solicitor, that he would never have contributed to “an atmosphere in which would racial abuse would have been tolerated”.