Charity Giving update - directions hearing update and opportunity to file evidence for court hearing
The High Court has ruled that charities and good causes owed money by the online giving website CharityGiving, run by the Dove Trust, will be able to have their say as part of a court case to decide how available funds should be distributed.
A directions hearing took place in March to fix a date for the court hearing to decide on the most appropriate method for distribution to take place and to set out the steps leading up to that hearing.
Opportunity to file evidence
At the directions hearing in March, the Court confirmed that any person - including charities and good causes - that wishes to file and serve evidence has until 4pm on 23 April to do so. Evidence should be sent to the Charity Commission, which will present it to court.
Anyone wishing to be heard at court has until 4pm on 1 May to make an application to be joined to the proceedings. This application should made using Court Form N244, which should be filed with the court and served on the parties to the proceedings.
If you would like to provide evidence in relation to CharityGiving and the distribution of funds, you need to send your evidence by 4pm on 23 April to:
The Charity Commission
PO Box 1227, Liverpool
Alternatively you can email your evidence with the subject line "Dove Trust Evidence" to firstname.lastname@example.org
The Charity Commission has also published a press release regarding this development on their website
The CharityGiving site was suspended in July 2013 by the Interim Manager as part of a Charity Commission investigation into the Dove Trust. The regulator is investigating serious concerns about the charity's governance and management. That investigation is ongoing.
In December, the Commission announced that the Interim Manager has concluded that there is, at present, around £500,000 available for an initial distribution to over 1,800 charities and good causes owed money by the Dove Trust. The Commission has been advised that, given the complexity of the charity and trust law issues involved, the court must decide on the fairest and most equitable approach to distributing currently available funds.
Copy of the Court Order
Copy of Claim Form
In January 2014 we advised that following the submission of a proposal for the distribution of Dove Trust funds by the Interim Manager, the Charity Commission made an application to court pursuant to s. 78 of the Charities Act 2011.
A process is underway to obtain a decision from the court as to how we must share out the money held by the Dove Trust to the charities and good causes to whom it is owed. As part of this process, a 'directions' hearing has been scheduled for 20 March 2014. Please note that this is not a hearing where evidence will be considered in depth or any decision as to payment out will be made by the court. It is a simply a hearing where the court ascertains how much time needs to be set aside for the subsequent hearing, when the evidence will be considered. It will also decide when the final hearing will take place. We will let you know the date of that final hearing once this has been scheduled.
For more information on why the Charity Commission made the application, see this press release on the Charity Commission website.
We will update www.charitygiving.co.uk with more information as it becomes available. The continued patience of the charities and good causes awaiting a distribution is greatly appreciated.
In November 2013, the Interim Manager provided a detailed report to the Charity Commission making a proposal for the distribution of funds held by him by virtue of his position as Interim Manager of the Dove Trust (the "Proposal").
The Charity Commission carefully considered the Proposal, together with external counsel. It came to the conclusion that an application needed to be made to the Court pursuant to s. 78 of the Charities Act 2011. That application was made to the Chancery Division of the High Court of Justice on 23 December 2013 (the "Application"). It is hoped that the Court will be able to give directions in January 2014 leading to the substantive resolution of the Application in early 2014.
The Charity Commission is inviting the Court to direct that (amongst other things):
- The final hearing of the Application be expedited.
- Details relating to the Application be posted on the www.charitygiving.co.uk website.
- Any charity or good cause who wishes to file evidence in connection with the Application may do so (albeit within a fairly short period of directions being given, in order that the Application can be resolved as soon as practicable).
The Interim Manager assisted the Charity Commission in preparing the Application and will file evidence in due course to assist the Court.
Further information about the options for distribution and the process is provided in a press release on the Charity Commission's web site (See Charity Commission press release)
The Interim Manager will provide a further update as soon as a directions hearing has been listed. The continued patience of charities and good causes is much appreciated.
Over August, the Dove Trust Interim Manager wrote to beneficiary charities and good causes as part of the work to reconcile the Dove Trust's accounts held in its donation management system.As this work is finished, we have closed the Dove Trust's offices. This reconciliation work is now complete - our thanks to the hundreds of charities that responded to our request for information. We are now comfortable with relying on the amounts showing on the Dove Trust's systems, and will soon be ready to proceed to the next step in the process.
We have identified over 4235 fundraising pages which are donating funds to 1810 charities and good causes. The next step is preparing for an interim distribution of funds to these charities and good causes, using the available cash assets of the Dove Trust. As part of this, we will be verifying each charity/good cause and its bank account details.
We will be providing another update soon, advising of timeframes and procedures for the interim distribution of funds. Thank you for your continued patience. We are aware that many charities are facing difficulties and we are working to make the interim distribution as quickly as possible.
The reconciliation of the Dove Trust/Charity Giving's accounts is now well underway to establish if there are any significant discrepancies between the money the charities are expecting to receive and what is showing on the Dove Trust's records. Over the past two weeks we have written to over 1800 charities and good causes, identified in the Dove Trust's records as intended beneficiaries, sending statements of their accounts, and are working with them to reconcile the accounts where discrepancies are brought to our attention.
The Dove Trust did not have an automatic system in place to undertake the reconciliation process, so it has taken longer than expected to manually identify appropriate contacts and match up fundraising statements in order to write to all beneficiary charities and good causes. Taking this into account, we extended the time for charities to notify us about discrepancies in their account to 19 August, with the possibility of further extension depending on the volume of responses received.
Thank you to the many donors, fundraisers and charities for bearing with us as we have been progressing our review of the Dove Trust's systems which contain the record of donations that have been received and amounts raised for charities and good causes.
We are close to completing our initial enquiries. The next step is to make an interim distribution of funds. Before we start this, we need to get assurance that the Dove Trust's records can be relied on to provide the correct information.
Fundraisers and page creators
If you have created a fundraising page with Charity Giving, please review your page. If it is not showing the correct balance please email our team at email@example.com
If you know that you have had more money donated than what is showing on your page, this is a discrepancy, and you should report it to our team. If there is no discrepancy you don't need to contact us.
We are contacting charities separately to discuss their accounts and the amounts they have received from Charity Giving.
To enable us to look into any discrepancies you must state the address of your web page in the email to firstname.lastname@example.org along with a list of what you believe the discrepancies to be. Please respond by Monday 12 August 2013.
Charities and good causes
We are writing to those organisations expecting funds to provide them with statements of their balances and will be asking them to notify us of any discrepancies that they are aware of.
As you will appreciate we need to manage the process of who we are working directly with. We are expecting any discrepancies to be notified to us by the fundraisers/ page creators and organisations that are expecting funds. If you have believe that your donation has not been correctly recorded then please contact the page creator.
What happens next?
We are still working as a matter of urgency on a solution to reinstate the Charity Giving website with another reputable provider, but unfortunately cannot provide any further information at this stage on this.
We are also not yet in a position to discuss when and how much money the charities and good causes will receive at this point in time. Please note that the team at email@example.com will be pleased to assist you with queries on your account balance - however, they will not be able to provide you with other information at this point in time whilst they undertake this urgent task.
We will continue to provide updates on the Charity Giving website and by automated response to emails as the matter progresses. Thank you again for your patience.
What have we found so far?
The distributable assets held by the Dove Trust are less than the amounts payable to the charities that should be receiving funds. This means that at any one point in time income received for a charity was being used to make payments to another charity which had earlier receipts that could not be met from existing funds. For example, receipts for charity "A" were funding payments made to charity "B" as charity "B's" income had been used to pay charity "C." This is not acceptable and it is therefore important that the amounts owing and available are reconciled before any further payments can be made.
The Interim Manager and his team tried to ascertain the correct financial position of the Dove Trust. This was not helped by the fact that the last accounts filed were for the year ended 5 April 2009. The trustees could not satisfy the Interim Manager or the Commission about the charity's financial position or the extent of the shortfall and the Commission acted to restrict movement on the charity's bank account to prevent payments leaving the accounts without approval from the Commission.
This situation could not be allowed to continue and the Charity Commission extended the powers of the Interim Manager to act to the exclusion of all trustees on 12 July 2013. It was agreed that further funds should not be received to ensure that they were not tainted by the problems of the past. Therefore the web site was suspended and the Dove Trust's banks were instructed not to receive further funds.
What is being done now?
There are two immediate priorities:
1. To ascertain the correct amount owing to the different charities and to consider what assets are available to repay them. The amount of the shortfall has yet to be quantified and there are many accounts to reconcile.
2. To identify and set up proper mechanisms that will enable charities to resume fundraising as soon as possible in a way that ensures that funds raised after the 12 July are ring fenced appropriately. Discussions are in progress with other portal providers to see how funding can be resumed. Some charities and fundraisers are already using multiple providers and have redirected their income to other alternatives.
Monitor www.charitygiving.co.uk and www.charitycommission.gov.uk for updates
Please note that given the volume of enquires that we are receiving we are not be able answer requests about specific fund raising pages' balances whilst we continue our enquires
Please bear with us
More FAQs and advice for donors, fundraisers and charities have been published on the Charity Commission website.
We can confirm that the Charity Commission has opened a statutory inquiry into the Dove Trust, who operate the online donations portal www.charitygiving.co.uk. Pesh Framjee, Partner at Crowe Clark Whitehill, has been appointed by the Charity Commission as interim manager to take full control of the management of the Dove Trust. We are currently working with the Charity Commission to consider as a matter of urgency the next steps in order to protect existing funds the public has donated, and any future donations. We recognise this will cause concern among the charities and donors using the website.
Please note the facility to create fundraising pages or receive funds has been suspended until further notice. We will issue a press release shortly and add further detail on the website in due course.
The Charity Commission has issued a press release which may be view on the their website at the following link: http://www.charitycommission.gov.uk/news/charitygiving-website-suspended/ You may also send enquires to DoveTrustInterimManager@crowecw.co.uk.
Please note, we will not be able answer requests about specific fund raising pages balance's whilst we continue our enquires.
We recognise this will cause concern among the charities, fundraisers and donors using the site.