A Charity Commission investigation into a football charity whose trustees “let down players” has helped recover £2.5m.
Today, the regulator published its inquiry report on the Players Foundation, formerly known as the Professional Footballers’ Association (PFA) Charity.
The regulator opened a compliance case into the charity on 23 November 2018 due to concerns about its relationship with the PFA, a connected trade union.
After identifying several issues, including in relation to the management of conflicts of interest, the regulator escalated its engagement to a statutory inquiry on 20 December 2019.
The regulator said its inquiry uncovered “a pattern of poor oversight and financial mismanagement that put charitable funds at risk over several years”.
This includes a £1.9m deposit from the Football Association in the Players Foundation’s bank account, which was transferred from the charity to the PFA in two separate transactions “without adequate explanation or governance”.
Meanwhile, the charity, which owned several properties in Manchester and London, allowed the PFA and its trading subsidiary PFA Enterprises to occupy these rent-free for several years.
Both the £1.9m and £627,000 in unpaid rent, plus interests, were repaid to the charity after the regulator’s intervention.
Failure in duty
The report says the Players Foundation had a longstanding relationship with the PFA, with “a historic understanding” dating back to the charity’s inception in 2013.
The charity received most of its funding through an arrangement between the Premier League and PFA. For instance, in 2017-18, it received around £25m from the Premier League.
An agreement between the PFA and Premier League set out how the charity should use the funding, but the charity itself was not party to that.
Under a “recharge agreement”, the charity gave around £6m to the PFA for its annual operating costs, including £5m towards 80% of the union’s staff costs.
The report says the Players Foundation employed no staff and relied on the PFA for most of its operational activity.
It points out that the recharge arrangement was not formalised in a written contract “despite the significant sums involved or the length of time the arrangement was ongoing”.
The report says the failure to review the recharge arrangement over several years was “a failure which the trustees were responsible for” and mismanagement in the charity’s administration.
Multiple conflicts of interest
The report highlights several inherent conflicts of interest from the multiple roles held by the charity’s trustees.
For instance, two of the Players Foundation’s trustees were “ex officio appointments” stipulated by clauses in the charity’s governing document.
The two individuals, who were senior executives at the PFA and directors of PFA Enterprises, included the then-director of finance of the union Darren Wilson.
Meanwhile, three other trustees held positions on the PFA’s business advisory committee, which set the salaries of the union’s staff.
The commission disqualified Wilson from being a trustee or holding a senior management position in any charity for four years after finding that he was responsible for misconduct and/or mismanagement in the administration of the charity.
It said Wilson “had a greater culpability than the other trustees, due to his role as a qualified director of finance”.
‘Blurred beyond distinction’
The Players Foundation has now implemented remedial actions including a proper separation of the charity from the union and the appointment of new trustees.
The PFA can no longer appoint trustees of the charity, while there are no longer ex officio trustees.
The charity stopped using the union to deliver its services, changed its name (which was nearly identical to the union’s) and now has its own distinct web presence.
In addition, it no longer receives funding from the Premier League and Football Association and has adopted an alternative funding model for the future.
Angela Ascroft, critical case lead at the commission, said: “In this case, the lines between the charity and PFA union were blurred beyond distinction, resulting in the multiple instances of conflict of interest and mismanagement at the charity.
“Charity trustees have a duty to act in the best interests of their charity, but trustees at the Players Foundation fell dismally short of this expectation and, as a result, let down the players they were supposed to be helping.
“The Charity Commission’s extensive regulatory involvement led to the disqualification of trustee Wilson.
“Since then, the Players Foundation is more separated from the union and can now focus on helping those it was set up to serve.”
