Inadequate oversight and poor compliance with financial controls meant an individual was able to steal significant sums from Royal Air Force mess charities, the Charity Commission has said.
A class inquiry into 72 RAF mess charities was opened in 2016, after the Commission was notified by the managing trustee of two charities of a fraud carried out by a contractor’s employee at RAF Honington. A class inquiry was opened because all the charities used the same control procedures, which are maintained by the RAF.
Zowie Davis, from RAF Honington, later pleaded guilty to fraud by abuse of position involving more than £72,000 and was sentenced to 18 months in prison at Ipswich Crown Court.
Yesterday the charity regulator published the findings from its inquiry, and criticised the charities for serious management and governance failures.
The RAF opened its own service inquiry in August 2016, which concluded that losses of over £200,000 occurred over approximately four years and had started prior to the implementation of the new contract arrangements in the mess charities.
Since 2016, the RAF has made good the losses to charity funds via the contractor and HM Treasury. It has also acted to address the local issues at Honington and the broader systematic risks identified.
Poor record keeping
The Commission inquiry found that at RAF Honington basic financial controls were not followed and that accounting records were not kept or maintained properly.
It also said that although the fraud was reported to civil and military police in 2014, more should have been done across the RAF mess fund estate to address the issues arising from the case.
This was partly down to a reduction in resources and confusion during the switchover to third party commercial service providers.
‘It should not have taken Commission intervention’
Harvey Grenville, head of investigations and enforcement at the Charity Commission, said: “The RAF failed to adequately protect the funds at RAF Honington, thereby allowing an unscrupulous individual to steal significant sums from the mess charities over a sustained period of time. The fraud was so significant for these mess charities that it left them in a precarious financial position which could have resulted in their collapse and had a direct impact on serving RAF personnel. It also exposed wider failures in the control and assurance systems used by the RAF.
“It should not have taken a Charity Commission class inquiry to mobilise an appropriate response from the RAF to address these issues and correct this situation. We are pleased to see the significant steps that have since been taken both to make good the losses and to address our concerns. However there are clear risks which arise from the short tenure of sole managing trustees appointed through the military system. We have stressed to the RAF the importance of ensuring that it maintains a sustainable governance, assurance and risk management framework for charity funds linked to its RAF stations.”
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