The Charity Commission has called for a “general power of disqualification” of trustees, as it admits that in the past it has been “too reticent” in using its regulatory powers.
It has accepted the recommendations of the Public Accounts Committee’s report, which heavily criticised the Commission for its lack of intervention in the Cup Trust case, and published its response as a Treasury Minute.
The Commission has confirmed that it is working with HMRC on a joint registration process, which would enable both authorities to retain independent decision making, but at the same time work more closely together.
It also confirmed that it has already tightened up its registration process since the Cup Trust was registered in 2009 so that it can spot organisations with complex structures and ask “probing questions” at the outset.
Sam Younger, chief executive of the Commission, said: “I accept that we have sometimes been too reticent in using our regulatory powers during investigations and that we must address this. We have often given trustees too many chances to put things right before taking action.”
He added that it would be good if the Commission had a “general power of disqualification” for people because "too often we see trustees resigning when we start the process of removing them, meaning that they are free to act as trustees for another charity”.
This sentiment was echoed by William Shawcross, chairman of the Charity Commission, in a speech to delegates at the Rathbones Charity Symposium yesterday. He said: “You can be convicted of terrorism offences or money laundering and still be a trustee of a charity. This is ridiculous to put it mildly.”
The comments from the Commission representatives yesterday afternoon coincided with the Law Commission warning that in its own review of the Charities Act, it may indeed look to change the rules around the Commission's power to remove and disqualify trustees.
Shawcross also explained how the Commission was increasing its efforts in the area of counter-terrorism.
Earlier this week, Younger said that the regulator will “dramatically step up” is action against charities which repeatedly file their accounts late. Options being discussed include fining late filers and barring them from claiming gift aid.
