Millionaire's charity faces regulatory scrutiny after delay to donation

16 Jul 2020 News

The Charity Commission is looking into concerns about a charity founded by a millionaire entrepreneur, after a five-figure donation was delayed for over a year.

The UKFast Community and Education Trust, founded by Manchester businessman Lawrence Jones, announced a £50,000 donation to homelessness charities more than a year ago, but the donation has not yet been made.

The Trust was also required to report a breach of charity rules in 2019 when two of its trustees were indirectly paid from charitable funds, according to financial accounts published this week.

Delayed donation to homelessness campaign

The Trust was established by Lawrence Jones and his wife Gail in 2016. In May 2019, the couple revealed that it had been endowed with £5m from their business, the cloud data company UKFast.Net.

A month later, Jones announced on his company’s website that the Trust was making its first major donation since the endowment, by giving £50,000 to A Bed Every Night, an initiative led by the city’s mayor, Andy Burnham, to support local homelessness charities.

In the announcement, which appears to have been removed from the website this morning, Jones said: “It was clear that what Andy and the team at A Bed Every Night are doing is pushing in the right direction to help those in greatest need in our region.

“Gail and I, with the backing of the UKFast Community and Education Trust trustees, knew we wanted to help and pledged £50,000 there and then.”

However, this month The Greater Manchester Mayor’s Charity (GMMC), which handles donations to A Bed Every Night, told Civil Society News that it has still not received the money.

A spokesperson for the charity said: “GMMC did not receive the pledged money from UKFast foundation last year.”

Donation ‘ring-fenced’

The Trust confirmed that £50,000 has not yet been sent to the charity, but has been “ring-fenced”.

A spokesperson for the Jones family said that the Trust would make the donation once “the team at the mayor’s charity confirm that the funds will comply with the UKFast Community and Education Trust’s articles and will be used directly for young people”.

Civil Society News understands that the Trust and the charity are now in touch, but the Jones family spokesperson was unable to provide any details about when the Trust first contacted GMMC about the donation, or what information, if any, it had previously requested from the mayor’s charity.

Departure from UKFast

Jones and his family were joint 203rd on the 2019 Sunday Times Rich List, with wealth estimated at £700m.

Lawrence Jones took a leave of absence from his role as chief executive of UKFast in October last year, shortly after allegations of misconduct appeared in the media. He denies the allegations.

He and his wife Gail have both now left the company.

Breaching charity rules

The Charity Commission said it is also looking at standards of financial reporting at the Trust, after its annual accounts were filed 73 days late. The accounts were eventually filed in the week after Civil Society News approached the Trust to ask about the delay.

In those accounts, the Trust says that it referred itself to the regulator last year, after realising it had breached its own rules on remunerating trustees. Money from the Trust had been used to contribute to the salaries of two members of UKFast staff, who also sat as trustees at the Trust and were committing some of their working time to educational projects.

The trustees received just over £48,000 indirectly from the Trust in total, according to the accounts. A spokesperson for the Jones family declined to confirm whether that money has been reimbursed to the Trust.

Charity Commission: Aware of concerns

A Charity Commission spokesperson said: “We are aware of concerns relating to safeguarding, the governance and financial reporting of UKFast Community and Education Trust.

“We are currently assessing information to determine our next steps.”

A Jones family spokesperson said they did not currently have answers as to why their accounts were filed late, and could not say whether the Trust had filed a serious incident report with the regulator after the allegations against Lawrence Jones were published.

Lawrence and Gail Jones remain trustees of the charity.

Trust is 'in the process of changing its name'

The Trust currently shares its address and other contact details with the UKFast company, but a spokesperson for the UKFast Group stressed that the business and the Trust are separate entities.

They said: “The charity in question has never been part of the UKFast Group.

“It was set up in 2016 by Lawrence Jones, the then CEO of UKFast. In 2018, it was agreed that UKFast would make a one-off £5m donation to the charity, though the business had no say in how the donated funds were used by the charity.

“We understand that, following the change in shareholding of UKFast in May 2020 that saw Lawrence and Gail Jones exit the business, the charity is in the process of changing its name to remove the reference [and] to cease the use of ‘UKFast’, in order to accurately reflect the fact there is no relation between the charity and the UKFast Group business.”

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