A rehabilitation charity paid around £300,000 to a company whose only directors were the former trustee and manager, a statutory inquiry has found.
The Charity Commission concluded that the former manager of Livingstone House Mother of the Harvest Ministries failed to comply with their legal duties and they have now been disqualified from being a trustee or senior manager for four years.
One former trustee voluntarily committed to not act as a charity trustee or senior manager of a charity for six years.
Repeated failures to submit accounting information
The Commission launched a statutory inquiry into the charity in July 2018, following repeated failures to submit accounting information. The regulator also had serious concerns about the management of the charity.
The charity’s purpose is to rehabilitate people with alcohol and drug addictions. It provides detoxification and care arrangements for men aged 18 to 65, using a Christian 12-step programme to encourage sober living.
Commission findings
The inquiry found serious issues in the financial management of the charity.
The report states the founder directly authorised their own salary, overtime, and bonus payments from the charity’s bank account.
Investigators found that a former trustee received unauthorised payments totalling £40,645, in breach of the charity’s governing document.
The charity also “failed to manage conflicts of interest adequately” and did not have a conflicts of interest policy in place.
Since its intervention, new trustees have been appointed and the regulator has issued the charity with an action plan aimed at improving governance and financial management, which has been fully implemented.
‘The public expects those in charge to guard funds carefully’
Amy Spiller, head of investigations at the Charity Commission, said: “The public rightly expects those in charge of charities to steward and guard funds carefully, for the benefit of the people their charity helps. Managing conflicts of interest robustly is therefore vital for charities to inspire trust.
“Charities that put their purpose at the core of all they do and underpin this with robust governance and the highest standards of conduct, will serve their beneficiaries better. I hope and expect that Livingstone House Mother of the Harvest Ministries will do this to continue driving forward positive change at the charity.”
The charity did not respond to a request for comment.
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