Concerns Over £22m in Cashed Cheques Spark Investigation into 10 Charities
The Charity Commission has launched an investigation into 10 charities after tax officials raised serious concerns about £22m paid in cheques to a company in east London. According to Civil Society, HMRC recently made an unannounced visit to a company in Hackney, where 105 charities were found to have cashed cheques with it to a value of £22m between December 2021 and March 2023.
The charity regulator has opened a statutory class inquiry into the 10 charities initially, but expects to extend its investigation over time. As reported by Civil Society, the Commission has also issued orders to temporarily restrict the charities from issuing cheques without its prior consent. This move aims to prevent any further potential misuse of charitable funds.
The 10 charities initially under investigation are Inspirations, Beis Aharon Charitable Trust Limited, Mifal Hachesed Vehatzedokoh, Friend of Beis Soroh Schneirer, One Heart – Lev Echod, Yad Vochessed Association Limited, Friends of Beis Chinuch Lebonos Trust, Chasdei Dov Trust, Friends of Mercaz Hatorah Belz Macnivka, and the Rehabilitation Trust. According to Civil Society, these charities have been prioritised after assessing the number of cheques issued and total value of those cashed.
The regulator aims to determine how these charities, several of which have the advancement of the Orthodox Jewish faith or education among their objects, have transferred funds. As Civil Society reports, the Commission will also investigate how trustees had oversight of what happened to funds exchanged for the cheques, and if this cash has been used properly to support what the charities were set up to do.
The Charity Commission will seek to establish how trustees determined that these financial transactions were in their charity’s best interests. This investigation will involve a thorough examination of the charities’ financial records and decision-making processes. As noted by Civil Society, the regulator will also assess whether the charities’ trustees have fulfilled their duties and responsibilities in relation to the management of charitable funds.
The investigation by the Charity Commission highlights the importance of transparency and accountability in the charity sector. As Civil Society reports, the regulator is taking a proactive approach to ensuring that charitable funds are used for their intended purposes, and that trustees are held accountable for their actions. The outcome of this investigation will be closely watched by the charity sector and the public, and is likely to have significant implications for the way charities manage their finances and make decisions.
In response to the investigation, a spokesperson for the Charity Commission said: “The Commission takes all concerns about charitable funds seriously and will take action to protect the public’s trust and confidence in charities.” As Civil Society notes, the regulator is urging charities to review their financial controls and ensure that they are compliant with regulatory requirements.
The Charity Commission’s investigation into the 10 charities is ongoing, and it is expected that further details will emerge as the inquiry progresses. In the meantime, the charity sector is advised to take note of the regulator’s actions and to review their own financial controls to ensure that they are robust and effective. As Civil Society reports, the regulator is committed to ensuring that charities are transparent and accountable in their use of charitable funds.
The Civil Society news provider has been at the forefront of reporting on this developing story, and their in-depth coverage has provided valuable insights into the investigation and its implications for the charity sector.
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