The Charity Commission has found serious administration and management issues at a faith charity following an investigation.
Its inquiry into Jamia Hanfia Ghosia Mosque and Princess Street Resource Centre found that trustees had not held valid elections but no evidence to support other concerns about unauthorised payments to them.
The regulator opened a statutory inquiry into the Staffordshire-based charity on 7 April 2022.
Findings
The Commission found that former trustees had not held valid elections, refused membership applications without good reason and did not have an accurate list of members.
It found the trustees failed to hold elections for trustees in 2019, 2020 and 2021, and though the inquiry accepted that Covid-19 was an unavoidable obstacle to holding an AGM and election in 2020, the former trustees failed to regularise these once restrictions had been lifted.
Trustee elections were also obstructed by disputes about membership eligibility and former trustees refused to accept membership applications from the community without a valid basis, so were not acting in the best interests of the charity, the charity regulator reported.
The inquiry found that the former trustees failed to follow the Commission’s written advice given on several occasions between March 2020 and April 2022 on these matters.
It also found the trustees disrupted a process led by Popularis, an independent election specialist, to develop an accurate up-to-date membership list and hold valid elections.
Regulatory action
In May 2022, the inquiry issued a legal order to allow the charity to hold a free and fair election outside of an AGM, which took place in June 2022, and resulted in the election of new trustees.
The Commission issued the new trustees with formal regulatory advice and guidance in December 2022, April 2023 and April 2024.
It reported that it is satisfied that the current trustees understand their duties and are capable of effectively managing the charity.
Some of the complaints received by the inquiry were concerning unauthorised trustee benefits, however the inquiry did not find any evidence to support these allegations.
It reporter: “The inquiry analysed bank statements of the charity between 2018 and 2022 and found evidence of a large transfer of charity funds to a former trustee.
“The inquiry directed the former trustees to provide information and supporting evidence to explain the payment.
“The inquiry found that the payment made to a former trustee was reimbursement for the cost of legal advice incurred as part of their trustee duties” it states.
The charity is in the process of changing its structure to a charitable incorporated organisation (CIO), which will see it dissolve and transfer its assets to the new corporate body.
Commission data for the financial year ending 31 March 2022 puts the charity’s total income at £202,000 and total expenditure at £180,000. The charity reporting is overdue by 76 days.
Trustees ‘failed to act in the charity’s best interests’
Amy Spiller, head of investigations at the Commission, said: “We expect all trustees to act in the best interests of their charity and in accordance with their legal duties and we will take appropriate action where trustees fail to do so.
“In this case, we found the former trustees failed, during a significant period of time, to ensure those entitled to membership of the charity had the opportunity to vote in regular trustee elections.
“They failed to act in the charity’s best interests, so let down the charity and its members.
“Our inquiry has addressed these issues and led to improved governance within the charity.
“We expect the new trustees to follow the advice and guidance we have provided.”
Jamia Hanfia Ghosia Mosque and Princess Street Resource Centre has not yet responded to Civil Society’s request for comment.
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