The Charity Commission has disqualified the former trustee of an educational charity for 15 years after he was found to have lost the charity more than £200,000.
In a report published by the Commission, the regulator concludes that the former trustees of Under Tree Schools are responsible for misconduct and/or mismanagement. The charity funds and operates a girls’ school in South Sudan.
The charity’s accounts for the financial year ending 31 March 2020 recorded an income of £53,592 and expenditure of £37,080.
One of the charity’s trustees, Reverend Ayok-Loewenberg, was a citizen of South Sudan and provided information regarding currency exchange rates in that country which were inconsistent with the commercial exchange rate at the time.
This resulted in the former trustees transferring significantly more cash from the UK than was necessary.
As well as one former trustee being banned for a period of 15 years, three other former trustees resigned during the Commission’s investigation.
Concerns raised following independent examination of accounts
The regulator began investigating concerns about the charity after an independent examination of its accounts raised questions about the transfer and subsequent handling of charity funds sent from the UK to South Sudan.
This was escalated to a statutory inquiry in December 2019, at which point the Commission froze the charity’s bank account.
The funds transferred by the trustees from the UK than were collected either by the now disqualified trustee or by people engaged by him, and the trustees were unable to prove that all the money was spent on the school.
As a result there is around £218,000, which cannot be proven to have been spent on the charity’s purpose.
The Commission finds that “the other trustees relied excessively on the now disqualified trustee for his knowledge of South Sudan, and placed significant trust in him”. This meant that they did not challenge the information provided by him.
The Commission disqualified Reverend Ayok-Loewenberg in December 2020.
'We are critical of all the former trustees'
The regulator notes that new trustees, appointed in January 2020, “have put in place more stringent financial controls, and taken steps to ensure staff at the school in South Sudan are aware of the importance of keeping sufficient evidence of how the charity’s funds are spent”.
Tim Hopkins, assistant director for investigations and inquiries at the Charity Commission, said: “Charities should use their resources efficiently and effectively, and be accountable to the public and donors who support them. The trustees of this charity failed in that regard. They did not ensure that the charity’s funds were fully accounted for, to show that they were spent to support the education of girls in one of the poorest parts of the world. We are critical of all the former trustees.
“This case demonstrates the risks of placing excessive trust in individuals in charities, without establishing appropriate systems, checks and balances, and keeping clear records. I hope other trustees learn from this case, and ensure that they are mindful of, and fulfil their individual responsibilities as trustees, towards their charities.”