Official Receiver’s investigation into Kids Company ‘thoroughly unfair’, High Court hears

Email correspondence that suggested policies around spending were “largely adhered” to was missing from expenditure report

The presentation of the Official Receiver's investigation into the former charity Kids Company was dismissed as “thoroughly unfair” at the High Court yesterday.

The court was hearing evidence from William Tatham, who had examined client expenditure, and whether it had followed the charity’s policies, on behalf of the OR.

Under cross-examination by Andrew Westwood of Maitland Chambers, who is representing former trustee Vincent O’Brien, it was put to Tatham that nowhere in his report was it suggested that expenditure was spent outside of Kids Company’s charitable aims.

Tatham said: “But not in adherence with the charity’s policies.”

Westwood pointed to email correspondence between Tatham and Ruth Lesirge, who the court heard had been privy to the charity’s expenditure. 

Part of the correspondence, which suggested policies on spending were “largely adhered” to, was missing from Tatham’s report.

“In retrospect I should have put that in my report, but she didn’t have access to other records,” said Tatham.

“Your presentation was thoroughly unfair?” asked Westwood.

Tatham said that was not his intention.

The OR is seeking to secure disqualification from senior positions for periods of up to six years against O’Brien and six other trustees of the charity, plus Camila Batmanghelidjh, its founder and former chief executive.

George Bompas QC, of 4 Stone Buildings, acting on behalf of former trustees Richard Handover, Francesca Robinson and Alan Yentob, who chaired the charity for 18 years, also claimed that the OR’s investigation had looked to find evidence to support the allegation that policies were not being adhered to, instead of being completely objective.

Bompas asked Tatham to point to an answer in Lesirge’s report that suggested there was no adherence to the charity’s expenditure policies. He was unable to do this.

Last week, Bompas described media reports of the charity’s spending as “salacious”.

Bompas pointed out a number of additional examples that showed Tatham had left out parts of answers in the interview process of his investigation that may run contrary to the allegation that spending policies were not being followed properly.

“None of the trustees acted dishonestly or in bad faith, they [which is the OR's case] were just lacking in issues of competence,” said Bompas.

Tatham confirmed this was the case.

The court heard that Lesirge’s report found no attempt to falsify records. Tatham also agreed that the “good work”of the charity was not in question, and that it was the duty of the claimant to present the evidence fairly.

Bompas suggested that future trustees, who are unpaid and give up a large amount of time, may not take on such a role because of the scale of the investigation and length of the subsequent trial.

“I can’t answer that,” said Tatham.

Daniel Margolin QC, a partner at JHA acting on behalf of Erica Bolton, also made the case that there was no evidence of inappropriate spending.

Tatham said it was about an absence of decision-making.

Margolin highlighted that it had taken Tatham and two colleagues about a year to conclude their investigation, which had relied on an analysis of spending in relation to the expenditure of the top 25 clients of the charity.

He asked Tatham whether it was fair to assume that trustees were in a position to undertake such a thorough investigation themselves.

“Undertaken in the sense they could have instructed someone else to do it,” said Tatham.

He suggested a review of clients' files should have been conducted on “a rolling basis.”

Earlier this week the High Court heard that the charity had been “fobbed off” at least 82 times by the government.

The 10-week trial continues.

Have you registered with us yet?

Register now to enjoy more articles and free email bulletins

Register
Already registered?
Sign in

Latest Governance Jobs

RSS Feed

Third Sector Insight

Sponsored webcasts, surveys and expert reports from Third Sector partners

Markel

Expert hub

Insurance advice from Markel

How bad can cyber crime really get: cyber fraud #1

Promotion from Markel

In the first of a series, we investigate the risks to charities from having flawed cyber security - and why we need to up our game...