The Charity Commission has removed the poverty relief charity Urban Relief from its register after running an investigation prompted by a trustee’s conviction for running a brothel and laundering money through the charity’s accounts.
The Charity Commission opened the inquiry after Francis Uwagbae, a trustee at Urban Relief, pleaded guilty at Blackfriars Crown Court on 14 January 2015 to a number of offences, including managing a brothel, concealing criminal property and using the charity’s bank account to launder funds from the proceeds of crime. Uwagbae was sentenced to 10 months in prison. The inquiry opened on 3 February, 2015.
The report says that after making further enquiries and examining the charity’s bank account, the regulator found that the charity’s income and expenditure in its annual returns "did not match with the amount of funds which have flowed through the charity’s bank account, raising concerns that the accounts had been falsified".
The charity had four trustees in total, including Uwagbae, but the commission found that two were unaware they had been named as trustees.
Further investigation found that the charity’s registered address had not been used by the charity since 2014.
When the commission directed the two active trustees of the charities, including Uwagbae, to attend interviews in September and October 2015, both failed to turn up or respond to further attempts by the commission to contact them.
The commission’s report says: "The inquiry was unable to establish or identify evidence of any charitable activities the charity had undertaken or how it had generated or applied its income, and is unable to make a finding in this respect.
"However, to the extent that the trustees permitted the charity to be used for a criminal purpose the inquiry finds that the trustees failed to properly exercise their legal duties and responsibilities, and had not exercised reasonable care in respect of the day-to-day running of the charity."
The lack of engagement by the two trustees with the inquiry meant it was unable to determine the adequacy of the trustees’ decision-making or how the trustees managed the charity’s finances.
The commission found that there were therefore a number of instances of mismanagement and misconduct committed by the trustees in the administration of the charity.
As the charity technically ceased to exist on 11 August 2014, the commission said, it removed the charity from the register on 21 November 2016.