Charity closed as it ‘misled public’ with ‘complete lack’ of fundraising transparency

14 Jul 2022 News

The Charity Commission has removed a charity from the register and ordered it to be wound up after finding it “misled the public” by transferring donated money to a private company instead of military veterans.

An inquiry into Support the Heroes’ was opened in November 2016, following complaints from members of the public about the charity’s fundraising activities.

In the financial years ending 31 March 2015, 2016 and 2017, the inquiry found Support the Heroes’ donated £223,000 in furtherance of its charitable purposes out of total funds raised of £1,318,039.

This is approximately 17% of its gross income over the period, and the report concludes this to be “a low rate of return“ to the charity when considering the gross income raised.

The regulator found that the charity had entered into a fundraising arrangement with a company named Targeted Management Limited (TML) in October 2014 for a term of five years. 

The only two trustees were sisters, and one of them, the chair of trustees, was the long-term partner of the father of the sole director of TML. 

The chair entered into agreements with TML, and agreed amendments “which incurred further costs to the charity”, without approval from the other trustee and without managing the conflict of interest.

TML were also significantly involved in the formation of the charity, according to the report, and the company received 67% of the gross proceeds raised from the public through its fundraising activities. 

The chair was also the registered sole director of the charity’s trading subsidiary, STHFL, through which the fundraising activities of TML were conducted. 

The trustees failed to ensure that at least one director of a charity’s trading subsidiary is not also a trustee of the charity.

Charity Commission: ‘The charity misled the public’

Amy Spiller, head of investigations at the Commission, said: “Donors have a reasonable expectation that the money they give reaches the cause they care about. 

“Due to a complete lack of transparency about the fundraising arrangements, the charity misled the public and much of the money went to a private company instead of military veterans and serving personnel in need.

“Cases like these have the potential to seriously undermine trust and confidence in charities generally. So it is right that we took robust action to ensure the charity was removed from the register and its trustees cannot lead other charities for a period of five years.”

Trustees cannot lead other charities for five years

The trustees responsible have voluntarily committed not to act as trustees of any charity for five years.

The Commission appointed an interim manager to the charity in 2016 and in 2018 the regulator ordered them to wind the charity up. 

Support the Heroes’ was removed from the register on 18 January 2022 and its remaining funds, £15,055, were redistributed to Help the Heroes in August last year.

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