31 charities struck off register as regulator tackles those ‘failing to meet duties’

28 Sep 2023 News


Scottish charity regulator OSCR has removed 31 voluntary organisations from its register as part of its focus on thousands of charities “failing to meet their legal duty”.

OSCR estimates that over one in 10 charities in Scotland are insufficiently filing annual accounts and engaging with the regulator and pledged to focus on them as part of its regulatory priorities for the next three years.

Separately, OSCR published an interim inquiry report on ZesT Football Club, which states that the charity should not undertake certain financial and charitable activities while it makes further inquiries. 

‘We hope to identify another batch of inactive charities soon’

This week, OSCR announced that it had identified 34 charities that no longer met the charity test, “the legal set of requirements that an organisation must pass to become a charity and be entered in the Scottish charity register”.

OSCR said that it made enquiries into the charities and found that they were defaulting as they had repeatedly failed to submit their annual reports and accounts within the statutory timescales. 

The regulator subsequently removed 31 charities after three responded to its correspondence or requested a review of its decision. 

Martin Tyson, head of regulation and improvement at OSCR, said that the regulator’s project team is “actively looking to find more charities that will be suitable for removal, and hope to identify another batch of inactive charities soon”.

He added: “Over the last few months, work has been undertaken by a project team at OSCR to identify charities that we believe are suitable to be removed from the Scottish Charity Register under section 28 of the 2005 Act.

“The 34 charities which have been identified for removal so far have failed, over a number of years, to submit annual accounting information. This is one of the primary ways of a charity demonstrating it is providing public benefit, and the vast majority of charities comply promptly with this duty.

“The charities were given a period of 21 days to respond to our correspondence or to request a review of OSCR’s decision. Of these, only three responses were received, resulting in 31 charities being removed from the register.”

10-12% of Scottish charities ‘failing to meet legal duty’

Tyson said that one of OSCR’s regulatory priorities until 2026 “is to focus on charities that fail to engage with the regulator and demonstrate to the public how they make a difference”.

He said around 10-12% of charities on the Scottish register, or between 2,522 and 3,027 charities, “are failing to meet their legal duty to file annual accounts and engage with OSCR”. 

“These charities are failing to provide key information to the public about what they do and how they spend their money – and so there’s no evidence to show they are meeting the charity test.”

OSCR hopes that identifying and removing such charities will increase the number of charities on the register “that are actively providing public benefit and reporting transparently to the public” and “maintain public confidence in charities and OSCR”.

It also hopes that this will reduce the resources needed to “pursue non-compliant charities”, allowing it “focus on other important work”. 

Inquiry into ZesT Football Club

Separately, OSCR issued an immediate direction to ZesT Football Club “given the apparent lack of both charity trustees and adequate financial procedures and controls”. 

OSCR began investigating the charity in April 2023 over concerns relating to its overall management.

Its interim inquiry report says that OSCR is concerned that the charity “does not have the minimum required number of charity trustees to manage the charity, and adequate financial procedures and controls are not in place to protect its assets”.

It has now ordered ZesT Football Club to stop any activities linked to its charitable purposes such as the provision of football coaching and “any financial transactions related to the governance or administration of the charity, except for refunding payments to individuals for cancelled football coaching and school holiday football camps”.

The report reads: “Our inquiries are ongoing and these directions do not pre-empt the outcome of those inquiries.

“These directions are valid for six months and expire on 27 March 2024. The directions can be revoked or varied by OSCR during that period if we determine it appropriate to do so.”

For more news, interviews, opinion and analysis about charities and the voluntary sector, sign up to receive the free Civil Society daily news bulletin here.

More on