This story was corrected on 15 June; please see final paragraph
The tax-avoidance charity the Cup Trust had only £11,526 to transfer to another charity when it closed last month despite having brought in £176.5m in private donations during its lifetime, the law firm Stone King has confirmed.
The Cup Trust has been the subject of a long-running statutory inquiry after it emerged in 2013 that it had raised £176.5m in private donations over two years but spent only £55,000 on good causes.
The charity had tried to claim £46m in Gift Aid and donors might have been entitled to claim another £55m in tax relief.
The charity was eventually wound up last month by the charity’s interim managers, Jonathan Burchfield and Ann Phillips of the law firm Stone King.
A statement from Stone King said today: "Jonathan and Ann wound up the now deregistered charity in May 2017, following a transfer of its remaining funds to a children’s charity.
"Grants of £20,000 were made by cheque prior to our appointment, which were drawn down after our appointment, and, as mentioned, the final transfer (after the addition of bank interest, the reimbursement of bank charges incorrectly charged to the charity and the addition of funds held by the charity’s accountants, and after the deduction of the previous grants, bank charges and the other law firm’s fees) was £11,526.26."
A High Court judgment of last year that allowed the charity’s interim managers to withdraw its Gift Aid claim said that, despite the Cup Trust having an income of £176m over its lifetime, virtually all of those funds were "almost entirely circular" and were not available to the charity.
Mountstar PTC, the company that acted as the corporate trustee of the Cup Trust, has today been disqualified from trusteeship for 15 years by the Charity Commission in one of the first uses of the regulator’s new powers.
The disqualification of Mountstar, which is based in the British Virgin Islands, is the first time the commission has used powers contained within the Charities (Protection and Social Investment) Act 2016 to disqualify companies from being trustees.
The commission said it was also considering regulatory action against the individual directors of Mountstar and was continuing its formal investigation of the Cup Trust.
The commission’s announcement comes after the Financial Reporting Council’s decision earlier this week to order an audit firm and two accountants to pay £390,000 in fines and legal costs for their actions related to the charity.
An earlier version of this article incorrectly described the Cup Trust as a "tax-evasion charity". Tax evasion is a criminal offence and we are happy to clarify that none of the directors of Mountstar, the charity’s corporate trustee, have been accused of this activity. We regret using the phrase and apologise for the error.