Newspaper reports over the weekend suggested that Richards was covering up some matters in the club's finances although after the FA inquired about the payments, they found out that he acted appropriately.
Part of an FA statement read: "Richards did in fact inform The FA and the League of these payments, made prior to his involvement at Sheffield Wednesday FC, at the time and fully co-operated with League and FA inquiries.
"Richards also informed the Inland Revenue of these payments, which was his responsibility as chairman of the club.
"The FA was advised of these payments at the time, was therefore aware of potential breaches of rules, and did not take any action."