The Public Safety Charitable Trust, which is facing a multi-million-pound bill for business rates after losing a legal battle with several local authorities, has been wound up in the High Court.
The charity leased 2,000 properties for a peppercorn rent in 240 local authority areas and installed transmitters to send out public safety messages through Bluetooth. The rest of each property was typically left empty.
The charity claimed that this activity constituted using the properties "wholly or mainly" for charitable purposes, which would entitle it to a mandatory discounts of 80 per cent on business rates and a potential discretionary discount on the remaining 20 per cent.
The charity was paid a premium by landlords who would otherwise have to pay full rates on their empty properties.
But three councils – South Cambridgeshire, Milton Keynes and Cheshire West and Chester – won a judgment in a joint case against the charity at the High Court in May, which ruled that full rates were due on all properties.
A spokesman for South Cambridgeshire District Council said the properties were mostly unused and the charity was just "a massive tax-avoidance scam".
After the judgment, South Cambridgeshire was granted a winding-up order in the Companies Court on Monday. Insolvency practitioners will be appointed to recover any remaining assets and distribute them to creditors.
The charity owes £1.6m to Liverpool City Council alone and is likely to owe other local authorities tens of millions, according to South Cambridgeshire.
Mark Ferguson, chair of the PSCT, confirmed the trust had been wound up, but said he could not comment further.
A spokeswoman for the Charity Commission, which has launched an inquiry into the charity, said that it would continue to investigate.
"We continue to consider our regulatory concerns and are working with other agencies in regards to our statutory inquiry," she said.