The Charity Commission was warned three years ago about an injured soldiers’ charity that donors feared was guilty of financial mismanagement, The Independent can reveal.
Retired RAF officer Peter Gaskin looked into Afghan Heroes in 2011 and was shocked to find it had spent just £13,000 on grants from £550,000 in donations.
However, an investigation was launched by the commission only last year into the charity, which was founded by Denise Harris in memory of her son, Corporal Lee Scott, who was killed by an improvised explosive device while serving in Afghanistan in July 2009.
Analysis of the charity’s accounts show that it has spent only £250,000 in grants despite securing nearly £2m in donations.
“I was deeply perturbed by what I saw and got on to the commission straight away,” said Mr Gaskin, who investigated the charity after he made a donation towards his nephew’s London-to-Brighton cycle ride in memory of a friend who was killed in action in Afghanistan.
“I was a bit surprised to get a one-line reply pointing to a section on their website entitled ‘How much should a charity spend on raising funds?’ I felt like I was being brushed aside.”
Analysis of the charity’s financial history show it received £1,906,247 between 2009 and 2012 but spent just £250,000 (12.5 per cent) on grants. Almost £800,000 was spent on “generating voluntary income” including costs for advertising and PR, the website and other “support costs”, which are not specified. Expenses for Mrs Harris and her husband, Andrew, a fellow trustee, rocketed from £357 in 2010 to £13,230 the following year, although none were paid in 2012. Running costs included £26,000 for “motors” and almost £35,000 on “postage and stationery”, the accounts reveal.
A spokesperson for the regulator said: “It is not unusual for newly established charities to incur a high proportion of fundraising costs before they have enough funds to properly begin to operate. In light of the charity reporting on its first year of operation, we were satisfied that we did not, at that time, have regulatory concerns. However we explained to the complainant that we would have regulatory concerns if a trend of low charitable expenditure emerged, or the charity failed to justify its reserves.
"We contacted the charity in September 2013 about how much income was spent on charitable activities and various payments to companies connected to some of the trustees and met with them in October 2013. As the trustees were unable to allay our concerns, a statutory inquiry was opened in November 2013 and remains ongoing.”
Mrs Harris said last year that full financial disclosure and access to records has been made to the commission.
The trustees have been “excluded” from Afghan Heroes while interim manager Brian Johnson, appointed by the commission, has suspended fundraising activities and is refusing to accept donations until further notice.