Regulator issues official warning to trustee of social housing charity

For what it describes as 'serious governance issues', the Charity Commission has used powers under the Charities Act 2016 against Marc Blanchette, a trustee of Expectations (UK)

The Charity Commission has issued an official warning to a trustee of the social housing charity Expectations (UK) amid concerns about "serious governance issues".

The regulator said it also had questions about decision-making relating to an emergency loan provided by a company whose director is an associate of a former trustee of the charity.

Expectations, which is based in Birmingham, has not filed its accounts for the past two financial years.

According to documents submitted for the financial year ending 31 March 2015, it had an income of £3.3m and employed 79 full-time-equivalent staff.

Expectations has been the subject of a regulatory compliance case since August 2017.

But the commission is now using official warning powers granted by the Charities Act 2016 against a trustee, Marc Blanchette, due to "a breach of trust and legal duties".

In a statement, it said it had issued the official warning "after the trustee, Mr Blanchette, failed to cooperate with the commission and failed to comply with two formal action plans previously issued".

The statement said the charity had failed to provide a business plan as evidence of its financial viability and to manage debts, despite several requests.

It added that the charity's decision to accept the loan "was not documented, and so it is unclear whether the conflict of interest and/or loyalty was identified and properly managed".

The commission declined to reveal the value of the loan. But the regulator said it was "encouraged" that five new trustees had been appointed after it advised the charity of the need to strengthen its board.

Tracy Howarth, head of regulatory compliance at the commission, said: "The public, and those that rely on the vital support of charities, expect high standards of integrity and accountability from those who run charities.

"This trustee has failed to live up to those standards, exposing their charity to serious uncertainty and risk.

"This warning should serve as a reminder to all charity trustees that their work is of high importance, and that they will be held to account for compliance with their legal duties and regulatory advice."

The commission cannot use official warnings to direct trustees to take specific action, but they can be used to specify any action it considers should be taken.

Failure to do so can be used as evidence of misconduct or mismanagement when considering whether to exercise other specified powers.

In this instance, the commission has said the trustees should carry out a governance review, file the outstanding accounts and submit a business plan.

The charity did not respond to calls from Third Sector.

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