Charity founder disqualified after nearly £40,000 paid to himself and his family

17 Nov 2020 News

The Charity Commission has disqualified the founder of Kenya Community Support Network (KCSN) after £39,500 was paid to himself and his family without adequate record keeping. 

KCSN has now been dissolved and the trustees have been reprimanded for their part in the allowing the mismanagement, according to the statutory inquiry report published this week. 

The Commission became involved in 2016 when Comic Relief suspended grants over concerns the charity was being used for personal gain. It progressed its engagement to a statutory inquiry in 2018 when it restricted the charity’s use of its bank accounts. 

The charity’s accounts for the year ending March 2016 show it received a £110,000 grant from Comic Relief. 

One fifth of expenditure not supported by invoices

The regulator’s inquiry report says that it was approached by Comic Relief in 2016, which was concerned about how money it had awarded Samson Ochieng who founded and ran the poverty relief charity, had been used. 

Before the Commission’s inquiry opened, Comic Relief instructed Mango (now known as Humentum) to investigate how money was being used. This raised concerns about KCSN’s ability to explain how money was spent. 

The Commission used its powers to obtain KCSN’s bank statements and visited the charity. It was able to trace 79% of payments to invoices, “although most of this was in relation to marketing activities”. 

However, 132 payments, totalling £15,991 and 21% of all expenditure, were not supported by invoices. 

“Many of these payments appeared, from the narrative on the bank statement, to consist of payments to Mr Ochieng, cash withdrawals from the bank and lifestyle spending (shops, restaurants, fuel, mobile phones),” the report says. 

A total of £39,500 was paid to Ochieng, his wife and daughter. The Commission was told this was reimbursement for charity expenses, however the regulator says “these reimbursements were generally not supported by third party evidence”. 

This included £8,400 that was transferred to the founder’s mortgage account.

“The charity’s trustees and Mr Ochieng were unable to provide a reasonable explanation of why the payments were made to his mortgage account rather than his current account as with other payments,” the Commission says. 

Some of the £39,500 relates to employing the founder’s wife to run a project.  

Ochieng’s wife was hired as a consultant to train Kenyan farmers and provide marketing services, but the Commission says trustees could not provide evidence of an open recruitment process. 

Benefiting private companies 

KCSN had been heavily involved in marketing activities on behalf of Kenyan companies. 

Charity representatives told the regulator that this helped to boost the Kenyan economy, but the Commission says it was concerned that charitable benefits were “incidental, indirect and hard to quantify”. 

After meeting with the charity, the regulator concluded that despite no longer being a trustee Ochieng was effectively in control of the charity and has disqualified him from being a trustee or senior manager at a charity for eight years. 

Tim Hopkins, assistant director of investigations and inquiries at the Charity Commission, said: “Good governance is not a bureaucratic detail, it’s essential in ensuring a charity delivers on its charitable purpose and isn’t exposed to unnecessary risk.

“The trustees of Kenya Community Support Network failed to provide this and instead, through their lack of oversight, enabled serious misconduct and mismanagement to take place. Our inquiry has rightly exposed the failures of this charity’s trustees and Mr Ochieng for his misuse of the charity and he has now been disqualified from serving as a trustee for his conduct.” 

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