Recent Charity Commission inquiries: Key lessons for trustees

Charities and not for profit

Charity governance is not a simple matter of box-ticking, it’s the foundation that protects public trust and ensures every charitable organisation fulfils its purpose. So, when oversight fails, the consequences can be detrimental to a charity’s future.

The Charity Commission prioritises regulatory oversight as a matter of significant importance. Every year, it launches statutory inquiries into numerous charitable organisations after identifying serious concerns about their conduct or management.

In this article, we’ll look at three significant investigations released in 2025, summarising the Commission’s findings, the results for the charities, and key takeaways for trustees.

Organisation supporting blind communities

What happened?

Founded in 1988, this charity supported blind, partially sighted, and disabled individuals with advice, training for employment, and advocacy.

The Commission first raised concerns in 2021, following accusations of potential wrongdoing against the charity’s CEO. Following trustees’ refusals to co-operate, even after an official Order under the Charities Act, the Commission opened a statutory enquiry in December 2022, which revealed the following failures:

Bank mandate neglect

Signatories were not updated after trustees left, leaving the CEO as sole signatory for almost five years, and giving him unchecked control over funds. This breached governing document and trustee duties.

AGM failures

OBAC did not hold an annual general meeting (AGM) for five years, violating its constitution and undermining accountability.

Late & missing filings

Annual returns and accounts were repeatedly late or not submitted at all, a clear violation of statutory requirements.

CEO misconduct

In April 2022, the CEO was sentenced to nine years in prison for immigration-related offences. Despite automatic disqualification under charity law, trustees allowed him to remain in post.

Illegal immigration advice

Even after losing regulatory approval, the charity continued to provide immigration services, a criminal offence under UK law.

Non-cooperation

Trustees repeatedly failed to comply with Commission directions, report serious incidents, or address governance weaknesses.

What was the outcome?

The charity’s reputation collapsed, its operations ceased, and frozen funds were passed to the Crown. Its four trustees were also disqualified for up to five years. The commission concluded that the trustees lack of skills and awareness allowed the organisation to be exploited for criminal activity, which ultimately led to its downfall.

Animal Rescue Charity

What happened?

This independent animal charity was dedicated to rescuing, rehoming, and providing veterinary care for unwanted or endangered animals.

After the organisation failed to file annual reports and accounts for 2019 and 2020, the Commission issued a warning under the Double Defaulter Class Inquiry. Despite this, the charity’s trustees still failed to submit their overdue accounts, triggering a full statutory inquiry in September 2022 which revealed the following irregularities:

Operating below minimum trustee numbers

The charity’s constitution required at least three trustees, but since 2019, only two remained.

Poor oversight and record keeping

Trustees admitted they had not read the Commission’s guidance, failed to keep minutes of meetings and had no written conflict of interest policy.

Financial mismanagement

Bank reviews revealed ambiguous payments and poor controls. Trustees were unaware of all bank accounts and continued using pre-signed cheques even after being warned this practice was unacceptable and exposed the charity to fraud and misuse risks.

Repeated filing failures

Trustees never submitted accounts from 2019 to 2021, claiming they lacked administrative skills but ignoring advice to hire an accountant.

What was the outcome?

In 2023, the Commission appointed an Interim Manager (IM) to take control. Unfortunately, the IM concluded that the charity was no longer viable due to depleted reserves, lack of fundraising, and trustees’ inability to meet basic governance standards. After rehoming animals and settling liabilities, remaining funds were distributed to similar charities. This case demonstrates the importance of effective governance in preserving charitable purpose.

Pentecostal Christian charity

What happened?

Originally founded in Nigeria, this charity focuses on propagating Christianity through evangelism, Bible education, youth programs, and relief for the poor, elderly and distressed.

Following reports of potential misappropriation of funds and Gift Aid irregularities, the Charity Commission’s inspection discovered that at least 100 branch bank accounts were opened without trustee oversight. This led to the opening of a statutory enquiry in 2018, which uncovered the following:

Excessive power concentration

The General Overseer (GO) held sweeping authority to appoint trustees, which undermined independence and created conflicts of interest.

Weak governance structures

The charity’s constitution was outdated and unfit for purpose. Branches operated autonomously, making major financial decisions without central approval.

Poor financial controls

Informal loans, unapproved property purchases, and liabilities from leases and planning breaches exposed the charity to significant risk.

Compliance failures

Trustees repeatedly missed deadlines for filing accounts and ignored Commission directions.

What was the outcome?

The Commission appointed an IM, who, after initially working alongside trustees, had to assume exclusive control after repeated non-compliance. Over five years, at a cost of around £1 million, the IM oversaw amendments to the constitution to reduce the GO’s powers, and a strengthening of financial controls and trustee recruitment. The Commission also issued freezing orders and multiple legal directions to safeguard funds and enforce compliance.

The inquiry concluded that serious misconduct and mismanagement occurred, but improvements have since been made. The Commission recognises the current trustees’ commitment to reform, and this case serves as a reminder that strong governance and responsible financial management are crucial to maintaining public trust.

Each of these stories highlights not just what went wrong, but why strong governance and proactive leadership are so vital within the Charity Sector. While the details differ, the underlying factors, and the lessons other trustees can learn from them, are strikingly similar.

Drawing from these real-world examples, here are the top lessons every trustee should keep in mind to safeguard their charity’s future:

Top Lessons for trustees

As your charity grows governance must evolve

Regularly review and update your structures to meeting changing needs and risks.

Comply with filing and reporting requirements on time – it’s a legal duty

Late or missing filings can lead to regulatory action and damage your reputation.

Know your duties and responsibilities as a trustee

Trustees must understand their legal obligations and act with integrity in the charity’s best interests.

Financial oversight is non-negotiable

Strong controls and clear reporting protect your charity from fraud and mismanagement.

Maintain the required number of independent trustees

A diverse, independent board aligns with constitutional requirements and ensures effective decision-making and accountability.

Act promptly on red flags or allegations

Immediate action can prevent small issues from becoming major crises.

Report serious incidents and cooperate with regulators

Transparency builds trust and helps resolve issue quickly.

Seek professional support when needed

Don’t hesitate to bring in outside expertise if you lack key skills.

Closing thoughts

These case studies demonstrate how not following Charity Commission regulations can seriously affect a charity, from damaging its public reputation to causing complete closure. Minor mistakes can escalate into significant issues, and inadequate governance or ignoring legal responsibilities can lead to severe outcomes.

Nevertheless, these stories also reveal potential for positive change. Trustees who stay informed, embrace good governance, and seek support when needed, can help their organisations thrive, even in challenging times.

By fostering a culture of accountability and continuous learning, you not only protect your charity’s future but also strengthen the trust placed in your work by the communities you serve.

If you’d like to learn more about the Charity Commission’s requirements for trustees, sign up to one of our upcoming seminars.

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