Trustees at a Bristol housing charity have been found guilty of mismanagement and misconduct, with a suggestion that they exploited their charitable status for financial gain, a recently published investigation by the Charity Commission has concluded.
Alternative Housing, whose charitable objects were to provide accomodation support and care to those in need within Bristol, has been removed from the register by the regulator now that the inquiry has finished.
The commission opened its near three-year inquiry in July 2017, after the charity was dubbed the “most prosecuted landlord in the UK” by a national media report that found it had been convicted of six breaches of the Management of Houses in Multiple Occupation (England) Regulations in two years.
When the commission opened the investigation it found that the charity appeared to have ceased operations, with the only recorded trustee claiming he had never been on the board and other trustees unwilling to provide information to the inquiry.
It also found that the charity had failed to file its accounts, a breach of charity law. Alternative Housing claimed that its annual income fell below the £25,000 threshold above which charities have to file accounts, but an order on the organisation’s bank account found that for two consecutive financial years its income had exceeded £200,000.
In the 2015/16 financial year, for example, the charity’s annual return reported that income was £7,980 and spending was £6,287, but the commission’s analysis found income at £268,693 and of £277,974.
The report also established direct and indirect links between the charity’s trustees and the directors of companies to which the charity had paid significant amounts of charitable funds.
In one instance, a signatory to Alternative Housing’s bank account owned a property that was inhabited by trustees of the charity. The signatory was additionally the sole director of a company that received £232,000 from the charity.
The two trustees who lived at the property, who were also signatories to Alternative Housing’s bank account, were respectively found to be the former director of a social housing lettings company and the sole director of a company that received almost £284,000 from the charity.
The failure of the charity to recognise, declare and manage these relationships was evidence of mismanagement and misconduct, the inquiry ruled
Amy Spiller, head of the investigations team at the Charity Commission, said the organisation had failed in its governance responsibilities.
“There are indications that the trustees might have exploited their charitable status for financial gain by paying significant funds to the companies connected to people at the charity while exposing beneficiaries to harm, and by failing to ensure the accommodation the charity managed was maintained,” she said.
Trustees had also failed to ensure the charity was capable of delivering suitable accomodation to its service users, the commission's report said. It added that problems with the charity’s properties, such as faulty fire equipment and alarms, had placed users at significant risk of harm.
“Charities exist to do good and ensuring beneficiaries are safe should be an absolute governance priority for all trustees,” Spiller said.
“The trustees of Alternative Housing failed in this responsibility.”
The charity was removed from the register on 8 October 2018.