New charity investigation: Cardiff Sixth Form College

10 Nov 2016 09:47 AM

The Charity Commission has opened a statutory inquiry into Cardiff Sixth Form College, registered charity number 1123262.

The Charity Commission, the independent regulator of charities in England and Wales, has opened a statutory inquiry into Cardiff Sixth Form College, registered charity number 1123262. The inquiry was opened on 29 July 2016.

The charity has objects to advance the education of young people in Cardiff and to support other charitable purposes. The charity carries out its objects by providing independent sixth form education.

The Commission opened a compliance case in April 2016 relating to the charity’s failure to submit its accounts. The Commission reviewed the charity’s accounts and identified a number of regulatory concerns, resulting in a books and records visit being conducted in July 2016.

As a result of that engagement, the Commission has identified regulatory concerns about the charity’s governance, financial management and significant related party transactions between the charity and some of its former trustees. The charity does not appear to have identified and/or managed conflicts of interest and there have been significant high value transactions which may not have been properly authorised.

The Commission considers that collectively these issues raise serious regulatory concerns about the administration and management of the charity which requires further examination. The inquiry will examine:

  • the administration, governance and management of the charity by the trustees with specific regard to decision making
  • whether there has been any unauthorised private benefit to trustees (current and former) or connected parties
  • whether the trustees (current and former) have properly exercised their legal duties and responsibilities in accordance with charity law and their governing document
  • whether any conflicts of interest have been properly identified and managed by the charity
  • the financial management of the charity, in particular whether the charity has sufficiently robust internal financial controls
  • whether there has been any misconduct and/or mismanagement by the trustees’ This Inquiry is about the governance and financial management of the charity not about its provision of education.

In order to protect the charity’s property, the Commission made an order to restrict the charity’s bank account under section 76(3)(d) of the Charities Act 2011. In addition, on 1 November 2016 the Commission appointed Emma Moody of Bond Dickinson LLP as an interim manager, under section 76(3)(g) of the Act. The interim manager has been appointed to the exclusion of the current trustees to review the governance infrastructure, as well as financial controls, and to manage and oversee the proposed sale of Cardiff Sixth Form College to Dukes Education. In addition, the Interim Manager will consider pursuing legal action if the charity has lost money as a result of breach(s) of trustee duty(s).

The Commission is also aware that South Wales Police are investigating a number of allegations concerning historic financial irregularities. We are liaising and working closely with South Wales Police as part of our investigation.

The Commission stresses that opening an inquiry is not in itself a finding of wrong doing. The purpose of an inquiry is to examine issues in detail and investigate and establish the facts so that the regulator can ascertain whether there has been misconduct and mismanagement; establish the extent of the risk to the charity’s property, beneficiaries or work; decide what action needs to be taken to resolve the serious concerns, if necessary using its investigative, protective and remedial powers to do so.

It is the Commission’s policy, after it has concluded an inquiry, to publish a report detailing what issues the inquiry looked at, what actions were undertaken as part of the inquiry and what the outcomes were. Reports of previous inquiries by the commission are available on its website.

The charity’s details can be viewed on the Commission’s online charity search tool.

Notes to Editors

  1. The Charity Commission is the independent regulator of charities in England and Wales. To find out more about our work, see our annual report.
  2. Search for charities on our online register.
  3. Section 46 of the Charities Act 2011 gives the Charity Commission the power to institute inquiries. The opening of an inquiry gives the commission access to a range of investigative, protective and remedial legal powers.
  4. The commission’s decision to announce the opening of a statutory inquiry is based on whether it is in the public interest to do so and with consideration of our objective to increase public trust and confidence in charities.

Read more information on the commission’s policy and factors taken into account when deciding to issue a press release.