The Charity Commission has opened a statutory inquiry into an anti-poverty charity after uncovering unexplained payments to private companies linked to some of its trustees.
The regulator said today it started engaging with the Asia Pacific Children’s Fund, which funds an orphanage in Bangladesh, in 2021 because of concerns about international cash couriering.
This led to the commission identifying “a number of further concerns which represented breaches of the charity’s governing document and charity law”, the regulator said.
The commission said it used its powers to obtain and analyse the charity’s bank statements and found payments to private companies linked to some of the charity’s trustees, which the trustees had been unable to explain adequately.
The regulator said it was concerned that the trustees could not fully account for all the charity’s expenditure or clearly explain how the orphanage and the funds it receives are managed.
“These concerns, exacerbated by a lack of documentary evidence and the charity’s often late statutory annual returns, are evidence of misconduct and/or mismanagement in the administration of the charity,” the commission said.
It said its inquiry would examine issues including the administration, governance and management of the charity by the trustees, conflicts of interest and/or loyalty and related party payments.
It would also looked into the charity’s financial controls and management and whether its funds had been properly expended solely for the exclusive charitable purposes and could be accounted for.
The charity was established in 2008 to aid people in poverty, particularly in Asia. It had an income of £829,000 in the year to the end of February 2022.
Nobody from the charity responded to a request for comment from Third Sector.