The Charity Commission has opened a statutory inquiry into the Spiritualist Association of Great Britain, after concerns emerged that it had sold a property to a company at well below its market value, which the company then sold on for a £15m profit.

The Spiritualist Association describes its charitable activities on the Charity Commission website, as offering private sittings with visiting mediums offering spiritual healing, absent healing and demonstrations of survival. It also holds classes for those wishing to develop their "innate psychic gifts".

The Commission found out in January that in 2010 the trustees of the Spiritualist Association had disposed of property belonging to the charity for £6m, significantly less than its market value.

It was sold to a company registered in the British Virgin Islands (BVI). When the Commission then began to engage with the charity to establish the facts about the sale, it came to light that, shortly after the disposal, the property was sold on to another BVI registered company for £21m.

And the sector regulator said that, to date, the charity trustees have been unable to demonstrate to its satisfaction that the steps they have taken and their decision-making in relation to the disposal were in the best interests of the charity.

As a result, the Commission opened an inquiry into the charity on 8 July.

The Commission said in a statement: “Our investigation will examine whether, and to what extent, there was mismanagement or misconduct on the part of the trustees. This will include whether the trustees complied with their legal obligations and fiduciary duties as trustees when disposing of a charitable asset.

“It is the Commission’s policy, after it has concluded the inquiry, to publish a report detailing what issues the inquiry looked at, what actions were undertaken as part of the inquiry and what the outcomes were.”

Civilsociety.co.uk could not reach the charity for comment.