Charities Bill will close loophole

The new Charities Bill will close the loophole that allowed the Alzheimer's Association, which was suspended last week by the Financial Services Authority, to circumvent the regulatory powers of the Charity Commission by registering as an industrial and provident society.

The FSA, which governs such societies under current regulations, said it had imposed a three-month suspension on the association because it appeared that "the business of the association is not being conducted for the benefit of the community".

The Institute of Fundraising and the Alzheimer's Society had reported concerns about the Alzheimer's Association to the Charity Commission and the FSA last year (Third Sector, 28 July).

The association's founders include Richard Trantom, who helped set up the Alzheimer's Foundation before it was closed by the Charity Commission in 2002.

Lindsay Boswell, the institute's chief executive, welcomed the suspension, saying: "One of our core concerns was that individuals involved in the association had previously been connected to another charity that was closed down by the Charity Commission and had then registered the association with a different regulator - the FSA.

"This loophole will no longer exist once the Charities Bill comes into effect. The new Bill will tighten up regulation in this area, bringing industrial and provident societies under the remit of the Charity Commission.

This means that one regulator will govern this whole area."

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