Charity founder disqualified after hundreds of thousands of pounds paid to connected companies

The founder of a rehabilitation charity has been disqualified from senior positions after she was paid tens of thousands of pounds in unauthorised payments and almost £300,000 went to a company of which she was a director. 

The Charity Commission said it had also secured a disqualification order against a former manager of the Livingstone House Mother of the Harvest Ministries who had directly authorised their own salary, overtime and bonus payments from the charity’s bank account. 

The regulator yesterday published the findings from its statutory inquiry into the Birmingham-based charity, which was registered in 2004 with the aim of promoting the Christian faith and to help people who have been affected by substance misuse. 

The commission said it opened an inquiry into the charity in July 2018 after it repeatedly failed to file its annual returns on time. 

The report said the founder of the charity, who is not named in the report but is identified on the charity’s website as Sally Livingstone, received unauthorised trustee remuneration of £40,645 between 1 May 2017 and 10 January 2019. 

The report said Livingstone had said the sums were salary payments for her work in Palestine. 

The regulator also found that between January 2014 and August 2018 the charity paid £295,689 to a company called Livingstone Ark Sober Living Houses, of which Livingstone and the charity’s former manager, who is also not named in the report, were the only directors. 

But the report said the payments to the company had since stopped and Livingstone had not personally benefited from the sums paid. 

It also said that between January 2014 and November 2017, the charity paid £189,426 to Addiction Solutions, a company owned by the charity’s former manager. 

The commission said the former manager told the inquiry that they routinely created invoices for Addiction Solutions and Livingstone Ark Sober Living Houses and then solely authorised the payment from the charity’s bank account without the authorisation of trustees or other employees.

The report concluded there had been serious misconduct and/or mismanagement in the running of the charity and that Livingstone and the former manager failed to comply with their duties. 

Livingstone stepped down as a trustee on 10 January 2019, the report said. 

In August this year, she signed an agreement that she would not act as a charity trustee or hold a senior management position at a voluntary sector organisation for six years. 

In December last year, the former manager was disqualified from the same types of position for four years. 

The commission said the charity's interim and new trustees had “implemented significant positive changes at the charity and are aware of their trustee duties and the provisions of the governing document”.

The charity declined to comment. 

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