As a reminder, charity trustees hold important positions of trust, and they are expected to ensure financial decisions are taken in the best interests of their charity and those it serves to benefit.
Misuse of funds may constitute a breach of trust for which the individual or individuals responsible may be held personally liable. If this arises, the Charity Commission may intervene to protect the assets of the charity.
A recent case illustrating the misuse of charity monies involves the Frank Wingett Cancer Relief Fund Committee (“the charity”). The charity was set up in memory of Frank Wingett, following his diagnosis with throat cancer in the 1980s.
The charity’s object was to relieve patients in Wrexham and District hospitals, particularly those suffering from cancer and allied diseases, by the provision of medical and surgical equipment and facilities.
The charity came under scrutiny after its funds were misused to support the creation of a 210ft (over 60m) Welsh dragon statue as a tourist attraction. This project has no connection to advancing the charity’s aims and to date, no statue has been built.
In July 2019, the Commission disqualified Simon Wingett from acting as a trustee or senior manager of any charity in England or Wales for a period of 10 years and has since pursued the restitution of funds.
The High Court of Justice has now ruled in favour of the Charity Commission following its decision to take legal action for restitution against the sole trustee. He is also required to pay a sum to cover the Commission’s legal costs.
In considering whether to take action against trustees, the Commission will take into account the following factors:
- The strength of the legal claim, the ability of those responsible to repay the sums involved and the proportionality of dealing with the matter this way and the optimum use of public funds
- The impact on the charity including any adverse impact on its ability to carry out its purpose effectively, on its beneficiaries and on its ability to raise funds to do this
- The importance of volunteers to a healthy charity sector and the impact on people’s ability to volunteer if they may be held personally liable for mistakes
- The importance in maintaining public trust and confidence in charity and its deterrent effect in ensuring that charitable funds which have been lost as a result of serious wrongdoing are recovered for charity
For the full press release please use this link.