The Charity Commissioners have put a receiver and manager in charge of a charity in a bid to save a recreation ground.

They found that more than £1.7m belonging to the organisation, called the Charity for a Recreation Ground at Bodicote, had been spent instead on Banbury Rugby Club, which is a non-charitable organisation.

A formal inquiry into the financial affairs of the charity began in March last year.

A spokesman for the Commissioners said: "The charity spent £1.7m plus VAT on the rugby club stand without authority from the commissioners. The charity needed authority because these were permanent endowment funds.

"Now all the charity's permanent endowment funds have been used to prop up continuing operations except for £50,000. About £80,000 a year has been spent on running costs, again without permission, for about four years."

The charity, which in 1994 sold its Oxford Road site, where Sainsbury's now stands, for £3.22m, was registered in 1986.

"It bought the Bodicote Park ground in time for the 1995-96 season for £536,000.

The Charity Commission spokesman said: "The case is ongoing. We will await the recommendations of the receiver and manager.."

The commissioners say the charity has insufficient investment income to pay its running costs and is in "severe financial difficulty".

Cherwell District Council issued a summons to the club's administrating company, Banbury Recreational Facilities Ltd, for almost £70,000 in unpaid business rates in 1999.

After a case in the county court, which the company lost, that debt has risen to about £100,000. The company went into liquidation on January 2.

Banbury town councillor John Colgrave, who became a trustee of the charity in 1996, said: "We're meeting the receiver on Thursday."