Britain’s charities watchdog today announced a statutory inquiry into a Birmingham-based Sikh charity over suspected financial mismanagement as a result of an internal dispute. The Charity Commission said it launched its inquiry into the Asthan Babe Ke Trust on May 11 following a regulatory compliance case, which was opened last year, after concerns were raised regarding allegations of “personal benefits, unmanaged conflicts of interest, invalid appointment of trustees, undeclared income and poor financial controls”. The charity’s declared objectives include advancing the Sikh religion and education, the relief of poverty, and the provision of facilities for social recreation and elderly care facilities in the region of the West Midlands and elsewhere in the UK.
“The commission has serious regulatory concerns that the charity has not been properly managed by its trustees, as a result of an internal dispute,” the watchdog said in a statement. The commission had set the charity an “action plan” to help the trustees resolve their dispute and issues raised, which included commencing a mediation process.
But it said it remains concerned about whether the trustees – listed as Jagdish Singh Dhillon, Manjit Singh Bhogal, Dharam Singh Ghatoura, Naginder Singh and Swaran Singh Sehmi – have sufficient oversight and control over the charity’s funds, payments and records, given that the group is seemingly controlled and administered by an executive committee who manage the its cash funds.
The commission added, “The commission is also concerned about the management of the charity’s freehold assets of almost 1.8 million pounds. In order to protect the charity’s assets, the commission advised the trustees to vest its UK property in the Official Custodian. However, the trustees have so far failed to do so”. “The trustees have failed to make any meaningful progress against the regulator’s action plan. As a result, the commission has opened a statutory inquiry to address its concerns,” it said.
The inquiry will examine the governance, management and administration of the charity by the trustees, with particular regard to whether the trustees have exercised sufficient oversight and control of the charity, especially with regards to its assets, whether the trustees are willing/capable of managing the charity in accordance with its governing document, whether the trustees have complied with previously issued regulatory guidance, and whether connected party transactions have been properly managed. As part of its role as an independent regulator of charities in England and Wales, the commission will publish a report into its findings and actions undertaken as part of the inquiry in due course.
