A charity that did not spend a penny of last year’s £10m outgoings on charitable activities, and is the subject of scrutiny by the Charity Commission, has gone into voluntary liquidation.
Of £10,013,631 spent by Nita Kinesiology in the year to 30 June 2013, £9.25m was classified as "other resources expended" in its annual accounts, with the remainder made up of £739,966 of investment management costs and £23,665 of governance costs.
The charity, which has objects including the relief of sickness and the promotion of health, registered with both the commission and Companies House in summer 2006. It was placed into liquidation on 23 May, with Michael Goldstein and Paul Shaw of accountants Myers Clark appointed joint liquidators. The charity is still listed as an active charity on the commission’s online register.
A spokeswoman for the Charity Commission said it opened a regulatory compliance case into NK in November 2011. This is looking at "concerns of unmanaged conflicts of interest and any potential unauthorised benefits in relation to transactions entered into by the charity including any new information gathered during the course of the investigation".
The spokeswoman said the commission would not comment any further because the case remained open.
When it was founded, the charity was given £1,289,449 by a company called Opal Bay Limited to put towards purchasing an investment property. Both Anthony and Mark Rubin, the two trustees of NK, are also directors of Opal Bay, and the two entities have the same registered address. It was agreed that in the event of the sale of the property, any profit would be divided between Opal Bay and NK.
Last year, Mark Rubin told Third Sector that the charity had intended to sell its property after two years "and then have a substantial sum available to create legacies as and when". He said that because the property market crashed, the charity had used all of its resources "to pay the bank its due", which is why the charity made so few donations.
The acquired property earned rent totalling £6,740,504 for the charity in the seven years to 30 June 2013, its accounts show.
The charity also paid out "investment management costs" totalling £4,723,341 over the years, of which £4,261,100 was "interest payable and similar charges".
The accounts for the year to 30 June 2013 say it had been pressured by its principal tenant into entering into "a settlement agreement with the charity during the year whereby it bought out the remainder of its lease", which resulted in the charity being paid £3.5m.
Goldstein, the joint liquidator, declined to comment.