Does the Commission use its powers enough

So should the Charity Commission have done more to stop the Cup Trust? Are they really an effective regulator?

Well, the answers to both those questions are tricky. Charities intrinsically operate with the public’s trust and therefore they are of course potentially open to abuse. As the Public Accounts Committee repeatedly pointed out the Commission has many far-ranging powers to deal with abuse, but in recent years has been reticent to you use them.

The Charity Commission has the authority to freeze bank accounts, remove or suspend trustees, appointment new trustees and interim managers to run failing charities. The problem as far as the PAC is concerned is that they do not act when they have legitimate and substantiated concerns brought to their attention, and this was clearly the case with the Power Trust.

From the figures provided at the PAC hearing it is clear that in recent years there has been very little, almost none-existent use of these powers and I believe that this is down to the management and leadership of the Commission that has not wanted to expose charity fraud and mismanagement into the public domain, and rather cosy up to the sector trying to make influential figures see it as a friend rather than a regulator.

There has been a concern that to identify fraud in the sector would damage the public’s confidence in it, but this is surely not the case. The public is surely wise enough to realise that there are bad apples in all walks of life and that the charity sector would be no different. What the public wants to see is an effective regulator taking on and dealing with wrong-doers and those who try to set up a charity for their own benefit. When a GP is struck off for misconduct it doesn’t stop us using health services, but rather give us confidence that rogue practitioners are being dealt with appropriately.

So, has the Commission always been reluctant to take on charity fraudsters? The answer is no. In the early years of 2000, the Commission has a number of high profile cases which exposed charity fraud and mismanagement and, in league with other public bodies, took significant steps in dealing with these. One famous case involved the charity CATCH!, resulted in the main protagonists being found guilty of Gift Aid fraud and theft totalling over £1M from the charity and they received several years in prison; 8 years for one; 7 another and others with 1-2 years.

So, will the PAC bashing be enough for the Commission to change course? Well, that is difficult as staffing has been slashed and resources are scarce and there needs to be a real will to change tack, so only time will tell.

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