Trustees at a children’s cancer charity have been criticised by the Charity Commission for a number of “serious deficiencies” including receiving unauthorised payments and failing to manage conflicts of interest.
The regulator’s damning report, following its investigation into the running of the now defunct Kids Integrated Cancer Treatment, concluded that there was “mismanagement and misconduct” by its trustees.
The charity, which launched in 2009 to provide financial support for families of children with cancer as well as medical treatment, was found to have inadequate financial controls and failed to keep and maintain accounting records.
Inaccurate and misleading information about the remuneration of trustees was also submitted to the Commission by the charity, which ceased to operate in 2014 and was removed from its register of charities a year later.
The Charity Commission’s report says that although there was some evidence it provided activities to help its beneficiaries it was “not possible for the inquiry to conclude that the charity was operating for the public benefit”.
The inquiry had been launched after concerns were raised that the husband of one of the founding trustees was businessman Kevin Wright, who was convicted in 2013 of theft and fraud by false representation, relating to fundraising appeals for children with cancer not linked with KICT.
Their investigation found that Wright was sole director of two companies KICT had agreements with. Despite trustees telling the regulator that it had gained £61,000 from these arrangements the charity’s bank records suggested it had made a loss from this association.
In addition, the Commission found that unauthorised payments and benefits had been made to three of the charity’s four trustees. One had received more than £17,000 over four years and attended 11 training events in America, which were part funded by the charity.
Other concerns were that trustees could not produce any evidence to confirm that cash withdrawals from the charity’s bank account were in support of its work with vulnerable families and children.
Charity Commission director of investigations Michelle Russell said: “While we found some evidence of charitable activity, there were numerous personal and business associations between the charity and the convicted individual, which led to significant financial personal benefits for him and his companies, and significant private financial benefit to three of the four trustees.
“That is absolutely unacceptable, as it goes against one of the most fundamental principles of charity, namely that charities exist to provide public, not private benefit.
“Those involved also allowed serious deficiencies to take place and mismanagement of and misconduct in charity. The trustees failed to comply with their duties and responsibilities and let down not just themselves, but also the people the charity was set up to help.”