Trustee spent £180,000 of charity funds on cottage and antique clocks, regulator reports

11 Jul 2023 News

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Civil Society Media

A trustee of a 60-year-old charity has been banned for 10 years after an inquiry found he spent over £110,000 of the organisation’s funds on renovations for his cottage.

The Charity Commission found that Hugh Morgan-Williams also spent £69,500 on two antique Mulberry longcase clocks which he claimed were an investment for the charity but were found on display in his home.

Its investigation into the Cowesby Trust found that the charity had not spent any money on its cause from 2009 to 2016.

Morgan-Williams received a 33-week sentence in June after admitting fraud at an unrelated privatised probation organisation.

Sole trustee for nine years

The Commission concluded that Morgan-Williams had been acting as the charity’s sole trustee for at least nine years.

It said this enabled him to act “unilaterally and without scrutiny”, with “no evidence of charitable activity” during this period.

Morgan-Williams had told the inquiry that the renovation of a cottage that he owned had been funded by three loans from the charity totalling £110,000.

However, the inquiry found no evidence that anyone aside from Morgan-Williams was involved in the decision to make the loan payments and insufficient documentation.

Morgan-Williams told the inquiry that he had purchased the antique clocks as an investment for the charity.

But the inquiry saw no documentation that recorded the decision to purchase the clocks or any independent expert advice to say the purchase was a good investment for the charity.

The regulator found Morgan-Williams responsible for serious misconduct and/or mismanagement in the administration of the charity. 

Amy Spiller, head of investigations at the Commission, said: “The Commission will intervene if we find charity funds are being misused, and I’m pleased that our inquiry has been able to identify the sum of the misplaced funds which have now been repaid in full.

“This case is an important reminder for all trustees to take care when making decisions that affect their charity.” 

Civil Society was unable to contact the charity for comment.

Money repaid

In 2016, the Commission opened its inquiry into the charity after North Yorkshire Police sent a report to it relating to suspicious activity in the charity’s bank account.  

Later that year, the Commission directed the Cowesby Trust’s banks not to part with any of the charity’s property without approval from the regulator.

It suspended Morgan-Williams, who received an OBE in 2008 for services to businesses in the north east, and appointed two additional trustees in 2017.

In 2018, the Commission disqualified Morgan-Williams from being a trustee or holding senior role at a charity for 10 years.

Morgan-Williams repaid £136,000 to the charity in 2020 while the two Mulberry clocks were sold for £26,000, with funds raised going to the organisation.

The Cowesby Trust, which was established in 1963 to support people who live in the north Yorkshire parish who are in need, hardship or distress, now has three trustees, all of whom joined in the last five years.

It recorded an income of £23,300 in 2020, but this reduced to £806 in 2021.

33-week sentence

Morgan-Williams was handed a 33-week sentence, suspended for 12 months, last month after he admitted to committing fraud while he oversaw a privatised probation organisation which received money from the public purse.

He took £27,000 from Durham and Tees Valley Community Rehabilitation Company (DTVCRC) while he was interim chairman.

Morgan-Williams used personal contacts with a private company he had links to, to procure contracts for DTVCRC and took 10% of the contract value for his own personal use without the knowledge of the board.

North Yorkshire Police said that the honours department of the Cabinet Office had been made aware of Morgan-Williams’s hearing with a view to a request to have his OBE forfeited.

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