The Charity Commission has opened a statutory inquiry into the Cowesby Trust over concerns about the financial management of the charity, which was set up to help people in hardship in a north Yorkshire parish
The Commission says that following the receipt of information raising regulatory concerns about the financial management of the charity, it conducted a series of enquiries including an analysis of the charity’s bank accounts, which identified a number of serious regulatory concerns about the operation and financial management of the charity.
Consequently, the Commission established that large sums of money have been paid from the charity to an unconnected company and to the charity’s trustee. The Commission has also established that there is a disparity between the level of funds that have flowed through the charity’s bank account and those disclosed in its annual returns.
The previous four annual returns have indicated an income of between £4,700 and £2,500 while expenditure each year is around £8,000.
The charity is also operating in breach of it governing documents, which state there should be at least three trustees, whereas there is currently only one trustee listed on the register of charities. The Commission says this gives rise to serious concerns about the legitimacy of the trustee decision making and whether charitable property has misapplied for non-charitable purposes.
The inquiry will examine the financial controls, management and application of charitable funds, property and assets belonging to the charity and the administration, governance and management of the charity by the trustees, and particularly whether the trustees have acted prudently and exercised reasonable care in respect of the day-to-day running of the charity.
It will also consider whether there has been any misconduct and/or mismanagement by the trustees and whether the charity’s objects are being met and the charity is operating for the public benefit.
In order to protect the charity’s funds and other property the Commission has also made orders to freeze the charity’s bank accounts. This prevents the trustee and the charity’s bankers from parting with any of the charity’s property without the permission of the Commission.
Once the inquiry is concluded, the Commission will publish a report on its findings and any actions and outcomes.
