Graham Taylor has described the former Watford chairman Jimmy Russo as a "bad man" for allowing the club's financial security to hang in the balance, reports The Guardian. Watford look set to be forced into administration after Russo and his brother Vince, the club's former vice-chairman, rejected a £7.5m rights-issue rescue package from majority shareholder Lord Michael Ashcroft on Wednesday evening.

Russo, who resigned his position on Tuesday, has demanded back the £4.88m he lent to the club despite the ramifications for Watford, who would be deducted 10 points and plunged towards the Championship relegation zone.

But Taylor, the interim chairman, told Sky Sports News: "The threat of administration is very real and we are approaching the fact that if that money is not paid to Jimmy then he can put the club into administration.

"Yesterday I saw an interview with Jimmy and he said he has not become a bad man overnight. I accept there is always more than one side to a story. But Jimmy, you walked into the AGM earlier this week, nobody knew what you were going to do, you resigned, you demanded immediately your £4.88m, payable within 48 hours. That's when you did become a bad man. It was not in the interests of Watford Football Club."

Russo has described the proposal put to him by Lord Ashcroft's company Fordwat Limited as "wholly unacceptable".

But Taylor added: "The Fordwat [offer] protects the immediate future of Watford Football Club and it allows an independent board to make what we think will be the right decisions to take this club forward. Is this the worst situation I have ever faced in 30 years involvement at Watford? Of course it is. We could go into administration but it doesn't have to happen."