Former Ibrox boss Walter Smith has urged the Scottish Football Association to wait until Rangers finds a new owner before handing out any sanctions.
The SFA's judicial panel this week hit the Glasgow giants with a fine of £160,000 and a 12-month embargo on registering players over 17 after being found guilty of five charges in relation to their finances and the appointment of Craig Whyte as chairman.
Rangers administrators Duff and Phelps will appeal against the punishments but have said news of the sanctions has further delayed their hopes of naming a preferred bidder, with American tycoon Bill Miller and the Blue Knights both still in the running for a takeover.
Smith said: "I think, especially, the embargo they've placed on signing new players for a year is an extremely tough one for Rangers to take at this time, knowing the circumstances that surround the club.
"Not only the administration but the fact that they could lose a lot of players at the end of the season.
"If they were taking sanctions, they could maybe wait until we get a new owner and he would maybe try to rectify some of the wrongs that have been created over the last few months.
"I think that opportunity should be given to the club."
Smith - who quit Rangers at the end of last season following his second spell at the helm - claimed his old club could face relegation from the Clydesdale Bank Premier League if the SFA sanctions are upheld.
He added: "In many ways, they have maybe underestimated the problems Rangers have at the present moment.
"They have gone into administration and they have had to make arrangements with players who, at the end of the season, can walk away.
"In the circumstances they are in, the majority of them might take that option.
"With no way to replace them, it means that Rangers could effectively be playing a team that is full of under-18 players.
"In that situation, relegation would face the club.
"Despite all the joy that a lot of people might be taking at the situation that Rangers are in, no-one - especially in the SPL - wants to see Rangers leave with the support they carry and the amount of money they bring to the league itself.
"The sanctions they have given would, in my mind, put them in danger of relegation and every club in the league would suffer then."
Rangers legend Sandy Jardine insists the sanctions would destroy the competitive nature of the SPL as well as crippling the club.
He said: "You would get a situation, which we are in at this moment in time, where, before the split has even taken place, that Celtic have basically won the league.
"You would have an uncompetitive league and that has implications for everybody.
"You have a lack of interest, there is not the same immediate coverage, supporters will drift off because everything has more or less been decided.
"Does everybody else want to see Celtic win the league by 30 points? Because that's the reality if Rangers are putting out a team of kids and are uncompetitive.
"What has kept Scottish football going over the last 10 years is how competitive it has been between Rangers and Celtic."
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