Allardyce, who is on a £3 million (NZ$5.35m) salary, agreed 20 minutes into a hotel meeting to become an adviser to businessmen who wanted to find a way around FA rules and become ‘third party owners’ of players.
He also mocked his predecessor Roy Hodgson during the meeting in a Mayfair hotel last month.
The BBC has reported that the FA is now investigating.
During the hour-long meeting, Allardyce agreed to to fly to Singapore and Hong Kong four times a year to address investors in return for £150,000 (NZ$205,000) per visit.
He said he would have to clear the deal with the FA first.
“In principle it’s OK,” Allardyce told the fictitious businessmen. “The fact that I’m going to be turning up on four occasions throughout the year, doing meet and greets and nothing else, so it’s not, nobody’s going to come back to me and say ‘I met Sam and I invested in this, this portfolio, and he told me to go and buy these young players, and that young player’, and that’s, you know. So they can’t blame me, do you know what I mean?”
However, he then went on to tell them how to get around rules preventing third-party ownership of players, by having agents working for the fictitious company who would represent the players and then be entitled to commissions.
Allardyce advised them it was “not a problem” to get around the rules implemented by the FA in 2008.
“You get a percentage of the player’s agent’s fee, that the agent pays to you, the company,” Allardyce said, pointing out that such portions could now amount to “millions and millions of pounds.”
“It’s not a problem… we got (Enner) Valencia in. He was third party owned when we bought him from Mexico.”
His agent then clarified that that ownership arrangement ended once the transfer was completed.