Sam Younger, chief executive of the Charity Commission, has warned that the regulator will “dramatically step up” its action against charities which repeatedly fail to file their accounts on time.
And he has called on the public, businesses and government to not give to charities which have not filed accounts with the Charity Commission, a position the Commission threatened it would take back in April this year.
Speaking at the Westminster Social Policy Forum today, Younger said that the Charity Commission’s experience was that defaulting on accounts was often associated with mismanagement and dishonesty.
“I’m not convinced that we’ve done enough so far to deal with trustees who persistently file late. Those who are wilfully negligent, or worse, may have something to hide.
“So we are stepping up our approach to those cases. My message to the trustees of charities in default is take action now to get your accounts in. You have been warned.”
Younger also asked the public, corporate and government donors to not give to charities which had not filed accounts with the Charity Commission. This follows research conducted by the Directory of Social Change which found just half of grantmakers check whether grant applicants' charities have a good filing history on the Commission website.
Younger also said the Charity Commission would increase its account monitoring work and make it clear on its public-facing online register when charities’ accounts are qualified by an auditor or independent examiner which indicates that the charity and the auditor or examiner do not agree on some information within the accounts.
He added that the Commission would be tougher on charities once they were under investigation, but said the regulator would also continue to produce online guidance for charities. “We would be building up enormous risks for the future if we focused all of our resources on dealing with abuses that have occurred, neglecting our duty to help prevent problems from happening in the first place," he said.
Younger also said the Commission needed stronger powers to disqualify trustees for it to be a “modern, effective regulator”.
Currently, the Charity Commission has to issue a formal notice by law before it can disqualify a trustee. "When sometimes we start to use our powers to remove trustees, the trustee in question resigns when they receive the formal notice. We then have no power to disqualify them," said Younger. "We have raised this issue for some time."