NEWS IN FOCUS: Commission gets licence to 'spy' on fraud suspects

Lucy Maggs

Invasive powers granted to the Charity Commission have created concern in the sector, and rekindled the debate on the authority's role. Lucy Maggs reports.

Undercover agents and covert photography may sound more like the domain of Scotland Yard than the Charity Commission, but the Government is to hand it the right to use these techniques to combat charity fraud.

The Charity Commission will soon be able to access communications data such as subscriber and billing information for email and telephone accounts.

It will also be able to authorise and carry out covert surveillance and use undercover agents to investigate charity fraud.

These new powers stem from the controversial Regulation of Investigative Powers Act 2000, also know as RIPA, which enables security services to monitor emails and other communications. Recent changes will allow public authorities, including the Charity Commission, to have greater access to communications.

The Charity Commission's new powers have raised implications about human rights. Campaigning organisation Liberty has questioned the legitimacy of the commission having access to this kind of information. A spokesman for the organisation said: "These powers are unnecessary, disproportionate and add yet more public bodies to the rapidly expanding list of groups authorised to spy on the British public."

Changes have also brought up a number of concerns in the voluntary sector about the commission and its operations. One concern is that the Charity Commission will use these invasive new powers to snoop into the affairs of innocent trustees. There is also the worry associated with increasing the power of an institution which already has the ability to come down hard on charities it suspects of wrong-doing. James Georgalakis, spokesman for NCVO, says: "While we welcome measures to ensure greater trust and confidence, the use of RIPA powers by the commission is a cause of some concern."

Belinda McKenzie, administrator at campaigning group the Association for Charities, asks if the commission needs these kinds of powers at all.

"Cases of fraud among charities are relatively rare," she says. "Shouldn't this kind of investigation be left to the police?"

But the Charity Commission maintains that legitimate charities have nothing to worry about because the behaviour of the commission will not be radically altered.

Kevin Dibble, director of legal services says: "We will use these powers in a proportionate way and only when making a criminal investigation, which is a rare occurrence."

He points out that the commission can already gather information when investigating a charity - although the new powers enable it to use different methods.

In giving new powers to the Charity Commission, the Government has rekindled the debate on whether the commission can maintain its schizophrenic role as both a watchdog and a friendly adviser to the sector. Organisations looking for advice about whether they are meeting regulatory standards already worry about approaching the Charity Commission in case their query comes back to haunt them.

The invasive nature of the powers will only heighten concern. McKenzie says: "This leaves a gap as to who charities will go to when they want help. It will make them less willing to approach the Charity Commission." She believes it gives added weight to the case for an independent body to give advice to charities. "It should be separate and representative of charities and grass-roots organisations."

But the Charity Commission has combined its advisory and regulatory roles for some time. Dibble argues it has always done so successfully and the new powers will not affect this balance.

Although the Government may have given the commission tougher investigative powers, Stephen Lloyd, partner at solicitors Bates, Wells & Braithwaite, says much depends on how the commission uses them. For a start, their use will be limited by money. "Charities should be careful," he says.

"They are dealing with a beefed-up regulator. But it won't have extra resources to pursue people.

"If it had more money, charities might need to feel worried. If it uses the powers to go after fraudulent fundraisers, that might be a good thing, but if they pursue regular trustees trying to go about their job, it's a different matter."

Despite reservations among charities, it could be regarded as a good thing for the sector if the commission is seen to take a tough stance on fraud. There is concern among charities that public trust has been dented by media coverage of charity corruption, and this could be regained if the commission is perceived as having teeth.

Andrew Watt, head of policy at the Institute of Fundraising, says: "Fraud has a massive impact on public perception, and as a result marginal and regional charities tend to lose out to bigger brands. When people feel their trust is being threatened they fall back on trusted names."

But Watt argues that in order to boost its own reputation and that of the sector, the commission needs to do more than crack down on fraud.

The new investigative powers could set the public's alarm bells ringing if the commission doesn't explain that a majority of charities go about their activities perfectly legitimately, but that a certain amount of investigative policing is necessary to weed out those which are corrupt.

Watt says the commission needs to educate the public about its own regulatory and advisory roles, and also about how modern charities operate: "If it is investigating fundraising, it needs to inform the public about what legitimate fundraising looks like and the processes that charities go through in order to collect money.

"Charity commission communications are in a different league compared with two years ago, but charities are of limited interest to broader media. The commission has its work cut out."

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