The Charity Commission has opened a statutory inquiry into a legally dissolved charity, the Khodam Al Mahdi Organisation (KMO), after discovering money has continued to be raised in the charity’s name and had been used to buy a property.
The Commission said the charity, which was also a limited company, was dissolved at Companies House in 2012 but did not inform the regulator or update its entry on the register – a legal requirement. The Commission has said the organisation no longer exists as a charity.
The KMO continues to be listed as active on the register, and lists its objects as providing recreation for young people and its activities as teaching about Islam. It has a home address in north London. It is listed as having filed all documents required, and for the last three years has had both income and expenditure of exactly £25,000.
However a Commission spokeswoman said the charity should have been removed from the register as it had been legally dissolved.
“In August 2013, the regulator became aware that the charitable company had been dissolved at Companies House,” the Commission said in a statement released today. “In following this up, the Commission discovered that funds had purportedly been raised in the name of the charity after its dissolution and that the funds were used to purchase a property.”
The Commission said it had opened a statutory inquiry on 17 February 2014.
“The investigation is examining the basis on which the funds were raised and is assessing whether the former trustees of the dissolved charity and the individuals holding the property have complied with charity law,” the Commission said in a statement.
The property at the centre of the inquiry has been taken into the custody of the Official Custodian for Charities, an arm of the Charity Commission.
A spokesman for the Khodam Al Mahdi Organisation said his organisation continued to operate. He provided a statement saying that his organisation was fully cooperating with the Commission’s inquiries.
“When we realised that mistakes had occurred in our administrative support, financial and structural policies, we immediately sought the services of the best available legal team and business consultants in order to put forward a comprehensive rebuilding plan of our entire structures,” the statement said.
It said the KMO had submitted a plan to the Commission explaining how it planned to rebuild, but problems had occurred “due to our lack of experience and the sudden resignation of previous trustees”.
