Charity faces investigation over missing accounts

The Charity Commission has opened a statutory inquiry into the Hindu Community Society  over serious governance concerns and the  failure to file accounts for six years running

The charity exists to promote charitable purpose for the benefit of the Tamil community in Coventry, particularly by advancing the Hindu religion.

Despite being previously included in a class inquiry in 2017 for failing to file its financial accounts, the charity’s trustees have failed for the sixth consecutive year to submit the charity’s annual financial information on time.

The Commission says that although it has issued repeated reminders in relation to its accounts for the financial year end 2016, 2017 and 2018, the trustees remain in continued breach of their legal duties.

Additional concerns arose around the potential loss of £500,000 of charity funds spent on a leased property, from which the trustees were subsequently evicted. The Commission also has concerns about potential private benefit arising from payments made to trustees for employment within the charity.

The Commission therefore opened a new statutory inquiry in June 2017 to examine serious concerns of potential misconduct and mismanagement at the charity. Up until now it has been unable to announce or progress its investigation so as to avoid prejudicing a separate HMRC investigation into the charity. HMRC’s investigation has now closed.

The Commission’s inquiry will now examine the extent to which the trustees are complying with their legal duties to administer, govern and manage the charity, with a particular focus on their compliance with legal obligations to prepare and file the charity’s annual financial information.

In addition, the inquiry will consider the extent to which the trustees have complied with previously issue regulatory guidance, and whether a properly appointed board of trustees is exercising proper and adequate oversight of the charity’s affairs.

The Commission says it will look at whether the trustees have avoided or adequately managed potential conflicts of interest and whether there has been any direct or indirect benefit, as well as the trustees’ decision making with regards to expenditure on property leased by the charity.

It is the Commission’s policy, after it has concluded an inquiry, to publish a report detailing what issues the inquiry looked at, what actions were undertaken as part of the inquiry and what the outcomes were.

Pat Sweet

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