The Charity Commission, the regulator of charities in England and Wales, has published a report of its investigation into Kids Integrated Cancer Treatment Ltd. The charity’s objects included providing financial support for families of children with cancer and providing medical treatment and other support for children diagnosed with cancer. The regulator removed the charity from the register of charities in 2015.
The Commission has concluded there was mismanagement and misconduct by the trustees, after finding a number of “serious deficiencies” in the charity’s management, including:
- unauthorised payments to trustees
- repeated failure to avoid or manage conflicts of interest
- inadequate financial controls and failure to keep and maintain accounting records
- the submission of inaccurate and misleading information to the Commission about the remuneration of trustees
The report states that there was some evidence the charity provided some activities to help its beneficiaries before it closed but it was “not possible for the inquiry to conclude that the charity was operating for the public benefit”.
The regulator is now considering what further regulatory action it may take, which may include the use of its new powers.
The Commission’s engagement with the charity began after concerns were raised about the charity’s links to an individual who was related to one of the founding trustees and was convicted of theft and fraud by false representation in 2013, in connection with fundraising appeals for children with cancer (not linked to KICT).
The investigation found that the individual was sole director of 2 companies that the charity entered into consecutive agreements with. The trustees told the Commission that the charity gained £61,000 from these agreements; however, the Commission’s scrutiny of the charity’s bank records suggests the charity had, in fact, made a net loss from its association with the companies.
The inquiry also found a series of unauthorised payments and benefits to 3 of the charity’s 4 trustees; one of the trustees received over £17,000 in the space of 4 years, and attended 11 training events in the USA, part-funded by the charity.
These payments were contrary to the charity’s governing document. The Commission also found that conflicts of interest were not managed in making decisions about payments and that there were poor financial controls in place. For example, the trustees could not produce any documentary evidence to confirm that funds withdrawn as cash from the charity’s bank account were properly applied in furtherance of the charity’s purposes.
Michelle Russell, Director of Investigations, Enforcement and Monitoring at the Charity Commission, said:
While we found some evidence of charitable activity, there were numerous personal and business associations between the charity and the convicted individual, which led to significant financial personal benefits for him and his companies, and significant private financial benefit to three of the four trustees.
That is absolutely unacceptable, as it goes against one of the most fundamental principles of charity, namely that charities exist to provide public, not private benefit.
Those involved also allowed serious deficiencies to take place and mismanagement of and misconduct in charity. The trustees failed to comply with their duties and responsibilities and let down not just themselves, but also the people the charity was set up to help.
The full inquiry report is available on GOV.UK.
Notes to editors
The Charity Commission is the independent regulator of charities in England and Wales. To find out more about our work, see our annual report.
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