The former England manager Sam Allardyce has lost his complaint that the Daily Telegraph broke journalism’s rules by sending an undercover reporter to propose a business deal and discuss rules on the third-party ownership of footballers.

Allardyce lost his job managing the national team in September 2016 as a result of the sting, in which one of the newspaper’s reporters posed as a representative of a fake sports management agency and secretly recorded their conversations. The press regulator Ipso concluded that the Daily Telegraph’s subterfuge was justified on the basis that it was a “productive and proportionate” way to investigate the types of commercial relationships Allardyce was willing to consider and the findings “could reasonably be considered to demonstrate sufficiently serious impropriety” to justify publication.

The regulator concluded that while Allardyce, who was due to earn £3m a year as England manager, did not break Football Association rules he did “show a disregard for them” by discussing potential workarounds on rules regarding the third-party ownership of players – a practice banned in England and “widely regarded as ethically wrong” – and there was a clear public interest in reporting this.

The England manager also entertained the idea of undertaking speaking engagements for the Daily Telegraph’s fake company for £400,000 a year, while making it clear that this would need the approval of his employers at the FA.

“The newspaper had also gathered evidence that he was willing to negotiate speaker fees with a company that was explicitly interested in third-party ownership of players,” said the regulator. “During the second meeting, he had witnessed a conversation in which a football agent appeared to suggest that an unauthorised payment could be made to a player.”

The 17,000-word ruling was delivered following an investigation into complaints by Allardyce, his agent Shane Moloney, and accountant Mark Curtis that they had been misrepresented and their quotes taken out of context.

The manager has always insisted the sting was unfair because, as the regulator stressed, no rules were broken. He also complained that the coverage was unfair since it was linked to a wider investigation into “corruption”, suggesting serious wrongdoing.

However, Ipso concluded that the matter was still in the public interest because of the high standards expected of such a prominent individual and ruled it was fair comment for the Telegraph to say that Allardyce had “tried to make as much money as possible as England manager”.

The regulator did rule that among the 15 articles published by the Daily Telegraph about Allardyce during September 2016 there were three significant inaccuracies that required correction. One related to a false suggestion the manager had implied third parties could benefit from transfer fees. The other two wrongly implied Allardyce had offered to brief the Daily Telegraph’s fake company on how to break ownership rules, rather than merely being willing to consider speaking at their events.

The regulator’s verdict approving the subterfuge relied partly on the fact that the Daily Telegraph said it was acting on anonymous allegations against Allardyce dating back to early 2015 that he should be investigated, in addition to a tip-off from an anonymous “specific football agent”.

The FA sacked Allardyce, who was last season also sacked as Everton manager, the day after the allegations were first published.

In a statement issued last night Allardyce insisted that Ipso’s ruling was flawed, the Telegraph “had put words into my mouth” and called on the journalists involved to hand back awards they won for the coverage.

He also criticised the leadership of the FA and how they handled their response to the story: “It was clear that those that I was dealing with were more concerned with their own image than getting to the truth of what had occurred. I will consider my position in this regard with my lawyers but I hope Martin Glenn and Greg Clarke reflect on the lack of leadership that they showed – not for the first time or I expect the last.”