The Charity Commission is examining "serious concerns" about a charity that withdrew support with less than two weeks notice from disabled service users and laid off a dozen staff.
The regulator said it had opened a regulatory compliance case on the financial management of Ripon Community Link as well as the trustees’ handling of the withdrawal of services.
A commission spokeswoman said: "The charity has reported the issues to the commission and, as part of our case, we are seeking to ensure that they have been fully and frankly reported.
"We recognise the distress that this has caused to those affected and want to reassure families that we are working to address the regulatory concerns as a matter of urgency."
She said the regulator's remit was restricted to trustee compliance with their legal dues.
"Any other concerns should be reported to the police or other relevant authorities," she added.
Ripon Community Link provides daycare services for people with learning difficulties in and around Ripon, North Yorkshire.
Its decision to stop supporting 12 vulnerable service users prompted families to set up an action group calling for the charity to be investigated.
A spokesman for the charity said it had appointed a new chief executive, Victoria Ashley, and a new chair, Kathryn Harrison, within the past six weeks.
He added: "Because of the Charity Commission investigation there is nothing more to be added at this stage."
The charity said its decision to shed a dozen jobs had been necessary to secure its future.
According to accounts filed with the commission, Ripon Community Link had income of £660,000 in the financial year ending 31 March 2017 – up from £642,000 the previous year.
North Yorkshire County Council, which provided a grant of £355,000, was its main funder.
Previous chief executive Lindsay Tanner described 2016/17 as a "wonderful year of growth and development" in her chief executive's report.
According to the accounts, it had 23 full-time-equivalent staff.
Some service users work at Ripon Walled Garden, which the charity acquired from Barnardo's in 2005.