New guidance for charities on reporting serious incidents

Senior Associate Solicitor Gemma RitchieThe Charity Commission has issued new guidance to help trustees identify and report serious incidents. Trustees are advised to read the guidance closely and in full.

Regardless of a charity’s size, its trustees should report serious incidents to the Charity Commission, even if they have already reported them to the police, donors or another regulator. Charities with an income above £25,000 must sign a declaration confirming there were no serious incidents in the previous financial year that were not reported to the commission. If there are unreported incidents, these should be reported to the commission before submitting the annual return.

If a charity’s failure to report a serious incident later comes to light, the commission may consider it an act of mismanagement, which could lead to regulatory action.

Who can report serious incidents?

A charity’s trustees are responsible for reporting serious incidents. Although they may delegate this task to someone else within the charity, the trustees are ultimately responsible for ensuring the incident is reported in a timely manner.

What you should report

The commission’s guidance stipulates that an incident should be reported if it results in, or risks, significant loss to the charity’s funds or assets or damage to the charity’s property, work, beneficiaries or reputation.

The main categories of reportable incident are:

  • Financial crimes (fraud, theft and money laundering).
  • Large donations from an unknown or unverifiable source, or suspicious financial activity using the charity’s funds.
  • Other significant financial loss.
  • Links to terrorism or extremism, including ‘proscribed’ organisations, individuals subject to an asset freeze or kidnapping of staff.
  • Suspicions, allegations or incidents of abuse involving beneficiaries.
  • Other significant incidents, such as insolvency, forced withdrawal of banking services or actual or suspected criminal activity.

Legal advice for charities in Eastbourne, Hailsham, Bexhill and Hastings

For expert training on trustees’ duties, advice about setting up a charity or advice on all legal matters that affect charities, please contact Associate Solicitor Gemma Ritchie (pictured) on 01323 435 900 or by email.

Our lawyers act for a wide range of charity clients, from small local charitable trusts to national organisations operating via corporate vehicles. To find out more about our services visit our charities page.

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