Chelsea have "apologised profusely" to former striker Gary Johnson, who was sexually abused while a youth-team player at the London club in the 1970s.
In a statement, Chelsea said Johnson had “suffered unacceptably” and that they had “no desire to hide any historic abuse we uncover from view”.
The club said an external review would examine whether they carried out a proper investigation when the allegations first came to light, and why they did not report them to the Football Association and Premier League.
“We are fully committed to ensuring the safety and well-being of all children and young people who are in our care or attending our premises,” the club said. “Their welfare is of paramount importance.”
It was previously claimed that Chelsea paid off Johnson, who alleged he was abused by the club's former chief scout Eddie Heath.
Johnson, 57, said he was paid £50,000 not to go public with allegations that he was sexually abused by Heath.
Chelsea said on Tuesday that they had appointed an external law firm to carry out a formal investigation into a former employee.
Heath, who was the Blues’ chief scout from 1968 to 1979, died before the allegations were made.