The Charity Commission has handed down its decision after its inquiry into the affairs of Citygate Christian Outreach Centre. The charity’s principal activities are maintaining a church in Beckenham, subsidising a community enterprise, and serving the local community with hall hire facilities and community support programmes. The report revealed multiple failures of proper management by the trustees.
According to the Commission, the charity failed to submit its annual report, accounts and return as required for the Financial Year 2019-20 and its accounting information for FY 2018-19 was submitted just before the inquiry opened on 21 March 2021. Further, the trustees had made an unsecured loan of almost £950,000 to a property developer “purportedly to fund a real estate project in Dubai, United Arab Emirates”, and had done so without taking professional advice. A settlement agreement was subsequently made for the loan and, fortunately:
“The charity has already recovered over £500,000 through the settlement agreement, and the inquiry is satisfied that, if the property developer continues to adhere to the settlement agreement, the charity will not have suffered a financial loss.”
The inquiry concluded that two of the three former trustees and, to a lesser extent, the third trustee, had committed serious misconduct and/or mismanagement. They had failed to act in the charity’s best interests, to manage the charity’s resources responsibly, to avoid exposing the charity’s assets to undue risk, to exercise appropriate decision-making, to take proper advice and to act with reasonable care and skill.
The Commission had previously made an Order removing two of the three trustees from office and the charity now has an entirely new board of trustees.
Further comment is superfluous.
This is really bad. What is the difference between misconduct and fraud in this case? Is there any article from the Church or trustees?