The Charity Commission has banned the founding trustees of Jole Rider Friends for 12 years after finding them responsible for serious mismanagement of governance and finance.
But the individuals involved have been critical of the way the case was handled, accusing the Commission of being unprofessional.
The regulator published its inquiry report on Friday. It found that since the charity had been set up in 2005, the two trustees, David Swettenham and Helen King, had received unauthorised remuneration of £322,500, representing 23 per cent of the income received by the charity during its lifetime.
The charity's aims were to send bicycles to Africa to help children get to school.
The trustees were contacted by the Commission in 2015 because the charity only had two trustees. It asked them if they had a conflicts of interest policy and if they received remuneration. The report says there was a “lengthy correspondence” where the Commission told trustees to stop paying themselves, but that “trustees failed to co-operate”.
On 21 September 2016, trustees were given one month to cease the unauthorised payments and to set a date to repay the money. A statutory inquiry was then opened in September 2017 after the charity failed to file its annual accounts on time for two consecutive years. In the charity's 2015 accounts, the independent examiner had highlighted concerns about unauthorised payments and the charity’s stock control.
An interim manager was appointed on 4 January 2019 on a pro bono basis. They wound up the charity and it was removed from the register in September 2019.
The Commission’s report says that the “the charity was insolvent” and that trustees did not supply a list of creditors.
It said that the charity owed money to its landlord, did not have adequate stock controls, and that there were poor records and documentation about sales from the bicycle shop. It also criticised the trustees for not engaging “professionally and openly” with independent examiners.
The report criticises the way the founding trustees made decisions about paying themselves, which contravened the governing document, and said that it had not seen enough evidence of the bicycles being sent to Africa.
Amy Spiller, head of investigations team at the Charity Commission, said: “The trustees of the Jole Rider grossly misused charity in paying themselves unauthorised remuneration, and in doing so they betrayed their donors as well as those that could have benefited from this charitable support.
“Their behaviour throughout, both in the running of their charity as well as during this inquiry, was a world apart from that expected of trustees. It’s therefore right that both trustees have been disqualified for the part they played in this matter.”
Both have been banned from being a trustee or holding a senior management role in charities for 12 years.
‘Woeful investigative practices’
Swettenham and King have accused the Commission’s report of being inaccurate and misleading, and have submitted 27 separate formal complaints to the Commission.
They previously set up a whistleblowing website detailing their issues with the investigation and attempting to warm other trustees.
In a letter to Helen Stephenson, chief executive of the Charity Commission, ahead of the publication of the inquiry report, they said the report includes statements which are “a serious and misleading distortion of fact”. The letter accuses some elements of the report as being “fictitious”.