News

Commission sees Serious Incident Reports almost double

Governance | Tania Mason | 22 Sep 2011

Some 337 serious incidents concerning vulnerable beneficiaries were reported to the Charity Commission last year, while the total number of serious incidents being notified has nearly doubled for the second year running.

In total, 849 serious incidents were reported to the regulator in 2010/11, up from 451 the previous year.  These comprised 371 cases of theft and fraud and 75 reports of charities being investigated by another body as well as the 337 cases concerning vulnerable beneficiaries.

Yet the Charity Commission is convinced that many more such problems go unreported.

Sam Younger (pictured), chief executive of the Commission, said it was encouraging that more trustees are reporting serious incidents, “but the fact that the number of reports has doubled in just 12 months shows just how much was being under-reported – and we believe still is”.

During the year the regulator opened 1,845 new assessment cases and completed 1,912 assessment cases. This compares to 2,434 and 2,615 respectively the previous year.  While the numbers have fallen, if the assessments relating to disqualified trustees are eliminated, the number of cases has actually risen.

The total income of all charities that have been subject to assessments by the Commission amounts to £9.1bn, or 17 per cent of the sector’s entire income. However, this has dropped from £13.9bn the year before.

The facts and figures are contained in Back on Track 2010/11, the Charity Commission’s annual update on its investigations and regulatory casework.

Despite the near-doubling in serious incident reports, the number of investigations carried out by the regulator stayed relatively static, with 144 new regulatory investigations in total, three of which were statutory inquiries.  The number of statutory inquiries have been falling steadily over the last three years, from 19 in 2008/9 and nine in 2009/10.

In 49 cases the Commission’s involvement helped to protect vulnerable beneficiaries. The report states: “Several cases involved actual, suspected or alleged abuse of beneficiaries, but we also saw a number of cases where we had serious concerns about charities that did not have effective safeguarding policies or practices in place.”

Fraud and theft

The total value of the fraud and theft reported this year was £6m, a significant drop from the previous year when it was £21m.

The regulator’s intervention also directly protected £8m worth of charity assets (2009/10: £29.5m) and monitored £900m worth of sector income (2009/10: £521m).

Some 108 charities were tackled because they didn’t submit their annual accounts, and of these 73 subsequently did, while 29 were removed from the register and the other six were referred for further investigation.

Concerns about fraud, theft, financial and fundraising issues went up from 16 per cent to 26 per cent as a proportion of overall completed assessment cases - a rise attributed largely to the increase in the number of serious incident and whistleblowing reports received.

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