Former pupil finding setting vulgar (7)
I believe the answer is:
obscene
'vulgar' is the definition.
(thesaurus)
'former pupil finding setting' is the wordplay.
'former pupil' becomes 'OB' (abbreviation for 'Old Boy' - private school pupil).
'finding' is a charade indicator (letters next to each other).
'setting' becomes 'scene' (I've seen this in another clue).
'ob'+'scene'='OBSCENE'
(Other definitions for obscene that I've seen before include "Offensive - indecent" , "Pseudonym" , "Shocking" , "Shameless" , "Bawdy" .)