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Double standards from the Charity Commission on interim manager case

Fundraising | Becky Slack | 1 Sep 2007

The Charity Commission has failed to enforce its own standards of best practice on the two partners from PricewaterhouseCoopers who are acting as interim managers of the Cancer Care Foundation.

Iain Oakley Smith and Adrian Stanway have neglected to submit any accounts for the charity since they were appointed by the Commission in November 2003, despite the Commission stating on its website that it 'will take firm action against charities that fail in significant degrees to fulfill their [reporting] requirements'.

PwC has been acting as interim manager following a Charity Commission section 8 investigation. The Commission believed that a subsidiary fundraising company of the charity, called Caring Together, had failed to transfer a relevant proportion of its profits to the foundation with a press release issued at the time stating that although Caring Together had generated £9m in 2001, CCF had only received an extremely small proportion of this.

A spokesperson for the Commission, said: "We continue to monitor and supervise their [PwC] progress and we are satisfied that they are discharging their duties and responsibilities effectively. We are aware that the charity's accounts are outstanding and can confirm that the interim mangers are taking active steps to resolve this situation as soon as possible".

In February 2006, PF reported that PwC had been accused of a breach of trust following news that it had made £200,000 worth of grants to a number of charities which were not intended to be recipients of CCF donations. These grants were awarded after the interim managers changed the charity's funding guidelines. However, the changes also meant that the charities named on CCF fundraising literature were no longer eligible to receive grants. Charity law states that if restricted funds are distributed other than in accordance with their restrictions then this is a breach of trust and the trustees, in this case PwC, will be personally liable to make good the loss to the restricted funds.

The East Anglia Children's Hospice is one charity that should have received funding from CCF. It estimates it has missed out on at least £100,000 since its grants were frozen by PwC in 2003.

"The last donation we received was £100,000 in 2003, which is enough for us to fund four nurses," said Graham Butland, chief executive of EACH. "We had been led to believe by the then trustees that we could expect a similar sum in 2004."

CCF is also involved in a long-running legal dispute with Fundraising Initiatives (which at the time owned Caring Together) and because of this both the Charity Commission and PwC have refused to comment on the above, on the grounds that to do so could 'potentially prejudice civil proceedings'. This case looks no closer to being resolved, despite having run up costs estimated to be in their millions.

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