The Charity Commission has opened a statutory inquiry into an animal charity which relies on direct mail fundraising and spends the majority of its income on raising funds.
Alterative Animal Sanctuary is 66 days late filing its accounts for 2016, but its accounts for the year ending 31 March 2015 admit that it is “virtually solely reliant on EuroDM”.
Income was £1.1m, with £890,000 coming from EuroDM. Total expenditure was £1.1m, but just £300,000 was for ‘charitable activities’. The charity spent almost £800,000 on raising funds. Its accounts for 2014 show similar figures.
Its accounts say that it entered into a seven-year agreement with EuroDM and that it expects that the “current deficit will be remedied before the contract has been completed”.
The Commission said it had been engaging with the charity since November 2016 as part of a “proactive project focusing on a sample of charities contracting with third-party fundraising agencies”.
It added that having obtained copies of the charity’s mailing material, the Commission had “further concerns regarding the transparency of the mailing material”.
This is the second inquiry into charities with high fundraising costs that the Charity Commission has announced in the space of a month.
The regulator is also investigating the Child Survival Fund, which spent more than half its income on generating income.
Child Survival Fund, was one of the ten charities identified by the Times last year as being part of a Commission investigation into charities with high costs associated with direct mail.
Alterative Animal Sanctuary was not named by the Times, though the Commission said it had identified 350 charities with direct mail as their main source of income, before selecting ten for further scrutiny.