Last week's revelation that three fraudsters claimed grants worth more than £500,000 from charitable funders including Comic Relief, Children in Need and the Big Lottery Fund's predecessor, the Community Fund, came as a shock to many in the sector.
But the ease with which the money was obtained, which exposes the inherent flaws in making small grants, is an even greater shock.
The three people convicted of conspiracy to defraud - Kitumbula Mazambi, his wife Mapendo Kasiba and his brother Kyalemaninwa Mazambi - set up a number of charities between 2001 and 2005.
These included the Great Lakes Initiative and Support Project, the Tanganyika Physical Activities Club, the African Francophone Women Forum and the Newham Great Lakes Youth Club.
All four were registered with the Charity Commission and collectively received a range of small grants worth up to £60,000 a time from at least 10 different funders.
According to a statement from the Metropolitan Police, there was "little or no evidence of bona fide charitable work being done, but ample evidence of the suspects using the funds to finance their lifestyles and/or send abroad".
Funders affected by the fraud, which was uncovered in 2004, note that it went undetected for so long because the charities took simple steps to appear legitimate.
Clare Thomas, chief grants officer at the City Bridge Trust, which gave £1,200 to the Great Lakes Initiative and Support Project, says: "We checked the charity was registered with the Charity Commission and the applicants provided two genuine references from big organisations in their local areas. They had obviously fooled the referees."
The trust has since closed the scheme from which the fraudsters claimed the money. Thomas says it is vigilant about grant applicants that provide only mobile phone numbers and PO box addresses.
A spokesman for the Football Foundation, which gave £2,000 to the Tanganyika Physical Activities Club in 2004, says the charity filed "eligible invoices" for its work, which suggested it was achieving its charitable aims.
A spokeswoman for Barnardo's, which approved a grant to the Newham Great Lakes Youth Club in its role as a distributor for BLF forerunner the New Opportunities Fund, says: "We followed the fund's guidelines, which included monitoring the charity's financial returns and evaluating its processes for service delivery."
In response to the case, grant-makers are sharing more information with other funders and visiting more of their grant recipients. But they acknowledge that small grants are vulnerable to fraud because funders avoid excessive regulation.
"Grant-making involves risks," says Thomas. "It would be a shame to stifle small charities because a few people abuse the system."