A Hampshire-based youth charity is under investigation by the Charity Commission over concerns about conflicts of interest and personal benefit.
The regulator said its statutory inquiry, opened on 5 July, was also examining whether Young Pioneers, which aims to advance the education of young people and support them by providing recreational activities, had a sufficient number of trustees.
In a statement published today, the commission said it had spoken to the charity in 2011 about its governance and financial arrangements after concerns were raised about personal benefit and conflicts of interest, and again in 2012 and 2015.
The statement said: "In June 2016, the commission received further information which indicates that individuals may have been receiving significant private benefit from the charity since 2010.
"As a result, the commission has concerns that the trustees have not acted on previous regulatory advice and guidance provided to the charity and have not properly identified or managed the conflicts of interest."
The charity has three trustees. The commission’s statement said it was concerned the charity was operating without sufficient trustees, raising concerns about the validity of the board’s decisions.
The statement said: "The trustees do not appear able, or willing to, manage the charity’s resources responsibly and to act in the best interest of the charity."
The charity, which in the year ending 31 October 2014 had an income of £419,000 and spent £349,000, was registered with the commission in 2007 and was founded by Luke Lancaster, a bullying victim now in his twenties, while he was still at school.
The commission statement does not explain what sparked the concerns about conflict of interest at the charity.
But the charity’s annual accounts, available on the Charity Commission website going back to the year ending 31 October 2011, list payments made to Mr P Lancaster and Mrs KS Lancaster, who appear to be Luke Lancaster’s parents.
Mrs Lancaster, who was a trustee of the charity until August 2012, is listed in all the available accounts as company secretary, while Mr P Lancaster is described as running the strategic leadership and management of the charity.
The accounts for the year ending 31 October 2014 reveal payments totalling £47,686 were paid to Mr and Mrs Lancaster over the year, which are described as fees for "services provided to the charity regarding teaching, delivery of services, training, strategic leadership and management coordination".
The accounts said: "The charity's future is heavily dependent upon the creation of sustainable funding, and this has been a major expense not only of extra time but personal costs incurred by the secretary, Mrs K Lancaster and her husband Mr P Lancaster.
"Both K Lancaster and P Lancaster work a 35-hour week and have a total of 1,800 hours over the year of time over and above to ensure that the charity gives the service required to keep young people both safe and cared for."
Similar comments are included in all of the available accounts, which show payments totalling between £30,000 and £56,000 to the Lancasters each year.
The available accounts show no employees of the charity since 2010.
The commission has used its temporary regulatory powers to protect charity property while the investigation is under way, according to the commission statement.
The inquiry will examine trustees’ administration, governance, management and decision-making, whether past and present trustees had properly exercised their legal duties, and whether they had committed any misconduct or mismanagement, the statement said.
It said the investigation would also look at whether there had been any direct or indirect private benefit to current or former trustees and whether the charity had robust internal financial controls.
No one from Young Pioneers was available to comment.