Charity chief executive failed to account for donations
17 Jun 2019
Busoga Association (UK)’s chief executive acted without trustee oversight, with funds unaccounted for and external consultants hired without trustees' knowledge, finds Charity Commission
17 Jun 2019
A Charity Commission inquiry into the Busoga Association has found serious mismanagement and misconduct by the trustees and CEO of the charity, who has since been disqualified.
Busoga Association was founded to support the relief of poverty worldwide, with a particular focus on the Busoga area in Uganda.
The Commission opened an inquiry following a complaint from the UK-based funder of the charity, Comic Relief, and found that not all of £767,000 donated to the charity could be adequately accounted for.
Trustees refused to meet with the Commission, but an inspection of all the charity’s books and records revealed serious accounting faults.
Between 8 September 2009 and 4 November 2013, £559,547 of the funds set aside for the Ugandan projects was transferred from the charity’s bank account into overseas bank accounts in the names of the projects, not in the name of the charity’s partners for the two nominated projects, leaving £82,723 unaccounted for.
The inquiry found that the trustees put the charity’s assets at risk and allowed the charity to be run by the CEO, who acted as a de facto trustee, without sufficient oversight. The CEO used the charity’s funds as he saw fit.
Accounting records were inadequate, so it was not possible to determine how all of the charitable funds had been spent. However, the day-to-day running of the charity was clearly undertaken by the CEO from 2002.
The CEO set his own salary without any consultation or approval from the trustees.
Decisions made solely by the CEO included a payment of £50,000 of restricted charitable funds towards a private consultancy firm, without consultation with or oversight from the trustees.
The CEO also submitted accounts to the Commission which had not been independently examined.
'The record keeping of the charity was so deficient that the inquiry was unable to properly reconcile payments received by the CEO through the charity’s bank accounts against the charity’s records', the Commission report stated.
Due to his actions, the Commission has disqualified the former CEO from acting as a trustee and from holding any office or employment with senior management functions for 10 years and secured a signed voluntary undertaking that a former trustee would not act as trustee for five years.
The inquiry also took protective action to freeze the charity’s bank account to prevent the further misuse of funds.
Amy Spiller, head of investigations team at the Charity Commission said: ‘The trustees of Busoga Association (UK) failed to protect their charity, allowing their CEO to use the charity for his own agenda. This was a terrible abuse of charity on his part and a complete failure by the other trustees to hold him to account. The CEO responsible has been rightly disqualified.’
The charity was struck off the register of charities on 6 October 2015.