The Charity Commission has opened a statutory inquiry into Asthan Babe Ke Trust, following serious regulatory concerns that the charity has not been properly managed by its trustees, as a result of an internal dispute, who may not have sufficient oversight of its funds
The charity’s objects include advancing the Sikh religion and education, the relief of poverty, and the provision of facilities for social recreation and elderly care facilities in the region of the West Midlands and elsewhere in the UK.
Based in Birmingham, Asthan Babe Ke Trust has an annual income of around £130,000 and in the four years prior to 2016, its accounts and annual report were consistently filed late.
A regulatory compliance case was opened in 2017 after concerns were raised regarding allegations of personal benefits, unmanaged conflicts of interest, invalid appointment of trustees, undeclared income and poor financial controls. The Commission then set the charity an action plan to help the trustees resolve the dispute and issues raised which included commencing a mediation process.
The Commission is concerned about whether the trustees have sufficient oversight and control over the charity’s funds, payments and records given that the charity is seemingly controlled and administered by an executive committee who manage the charity’s cash funds.
The Commission is also concerned about the management of the charity’s freehold assets of almost £1.8m. In order to protect the charity’s assets, the Commission advised the trustees to vest its UK property in the Official Custodian, but so far they have failed to do so.
The trustees have also failed to make any meaningful progress against the regulator’s action plan.
The statutory inquiry will now look at the governance, management and administration of the charity by the trustees, with particular regard to whether the trustees have exercised sufficient oversight and control of the charity, especially with regards to its assets.
The inquiry will also consider whether the trustees are willing/capable of managing the charity in accordance with its governing document; whether they have complied with previously issued regulatory guidance; and whether connected party transactions have been properly managed.
After the inquiry has concluded the Commission will publish a report detailing what issues the inquiry looked at, what actions were undertaken as part of the inquiry and what the outcomes were.
Report by Pat Sweet
