Two trustees of a Christian charity that were paid £100,000 in unauthorised benefit have handed the money back to the charity, according to a Charity Commission inquiry report.
Life Changing Ministries International Church South Cheshire Trust, which registered with the commission in 1997, had an income of £279,710 in the year to 31 April 2013, nearly three times more than the previous year’s figure. Its objects are the advancement of Christianity and religious education, and providing relief to the sick, older people and others.
"In February 2012 the commission received an anonymous complaint from a member of the public alleging that trustees of the charity were personally benefiting from the charity’s funds," according to the report on the commission’s statutory inquiry, which was published today.
Further engagement with the charity’s trustees found that charitable funds had been used to pay for a loft conversion at a property owned by two of the trustees, the report says. The commission opened a statutory inquiry into the charity in October of the same year after the charity had allegedly failed to cooperate with the commission – something the charity denies, the report says.
The inquiry was opened to investigate whether a property had been gifted to the charity and subsequently sold to a trustee in a manner not compliant with charity law or the charity’s governing document, and to look into potential unauthorised trustee benefits and the management of conflicts of interest.
The report says that the concerns about the property’s sale were not substantiated, but the commission advised the trustees to consider obtaining independent professional advice on whether their Gift Aid claim on the initial donation of the property was correct.
It did find, however, that two trustees received unauthorised benefits and these sums, totalling £100,000, were repaid in full to the charity.
The report says: "The trustees did not understand, identify or properly manage the conflicts of interest, although the trustees disagree with this. The charity was operating beyond its means, relying on credit and loans to continue to operate."
It also acknowledges that, once the inquiry had been opened, the trustees did cooperate with the commission. The statutory inquiry was closed today with the report’s publication.
Reverend David Griffiths, a trustee of the charity, told Third Sector in an email that he believed the initial complaints came "from a subversive group" that had made threats to the charity.
Griffiths said he supported the principle of freedom of religion, but was "concerned that there are those in society who look to destroy others of different viewpoints and that this can be done through the application of the letter of the law".
He said he feared the UK was "an over-regulated society" and that he and the other trustees regretted that the inquiry had resulted in the charity having to divert time and resources away from its cause.