Commission closes children's charity

Organisation spent less than 1% of income on declared purpose and allowed trustees to profit

The Charity Commission has overseen the closure of a disabled children's charity that spent less than 1 per cent of its income on its charitable purpose.

The Jigsaw Children's Support Foundation registered with the commission in 2004, but its accounts for 2006/07 showed that it spent just under £1,500 of its £210,000 income on charitable purposes.

Most of its income was spent on staff costs and buying badges and teddy bears to send to companies that agreed to raffle them on its behalf. Many of the companies failed to send the charity any money or to return the stock, leading to a £180,000 hole in the charity's accounts.

The charity bought the stock from its trustees at a reduced price. The trustees admitted their business had profited from the arrangement but refused to say by how much.

The commission also found that professional fundraisers working on behalf of the charity in supermarkets had broken fundraising regulations. Both the trustees and the fundraisers denied knowledge of the regulations.

The commission's inquiry report says the charity was operating as a professional fundraiser and not a charity. It says the trustees could not demonstrate that they made efforts to reduce their excessive administration costs and generate more disposable income.

The charity was removed from the register in November. The remaining assets of about £8,600 were given to charities with similar objects.

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