The Charity Commission has opened a statutory inquiry into a charity that provides financial support and advice for other charities, after questioning the accuracy of the charity’s accounts.
Hampshire-based the Catalyst Trust provides project management and advice, loans, grants and guarantees to charities, and has a particular interest in helping charities with building projects that create employment, according to its objects.
The commission received a complaint in October 2013 about the charity’s finances – the complainant wondered whether the trustees’ acceptance of a gift of a property had been in the charity’s best interests.
A books and records inspection of the charity carried out by the commission in February 2014 found unexplained transactions totalling more than £60,000. This raised concerns about the accuracy of the accounts because the charity had never declared an income of more than £25,000 in its annual return.
The Catalyst Trust had an income of £4,500 and expenditure of £500 in 2012, according to figures on the Charity Commission website.
The regulator opened a statutory inquiry into the charity on 10 June after not receiving a satisfactory response from the trustees about its concerns. The commission said the investigation would look into the charity’s financial management and governance, and whether it has been used for private benefit.
Jon Bowles, one of the three trustees of the charity, said the allegations "had no foundation behind them whatsoever". He said that the trustees had never taken any private benefit out of the charity.
"There is so much abuse in the charity sector that to pick on me is unbelievable," he said. "The loss in charitable benefit to society will be considerable."
Bowles said he had personally loaned several hundred thousand pounds to the charity and had considered writing these off as donations, but would now be calling these back in and closing the charity.
The charity’s entry on the commission’s register of charities shows that since it was registered at the start of 2008 it had a total of £20,000 of income during the following five years and spent £1,853 in this time.