Reporting fraud – what are the trustees’ responsibilities? - PKF Francis Clark
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Reporting fraud – what are the trustees’ responsibilities?

No organisation is immune to the risk of fraud but the charity sector is particularly vulnerable. The latest data suggests that in 2017 alone the sector lost £2.3bn to fraud. As this week marks Charity Fraud Awareness Week, we look at the implications if the worst were to happen to your charity. Would you know what your responsibilities are?

The Charity Commission has recently updated their guidance on how and when to report serious incidents. As fraud may result in a significant loss to charity money or assets, or could harm the charity’s reputation, it is vitally important that all of the reporting requirements are followed.

There is no minimum loss figure that should be reported – trustees need to decide whether the incident is serious enough to report in the context of the charity and its income. Other factors will also influence the severity of the incident including the individuals involved, the number of connected incidents or whether there are signs of public interest and media reporting.

The Charity Commission also emphasises that, as well as their reporting requirements, the trustees must also report the actual or alleged fraud to the relevant agencies. Any alleged or actual fraud should be reported to Action Fraud using its online reporting tool, making sure that a crime reference number is obtained. The charity should report the incident separately to the police.

Reporting to the Commission should happen as quickly and fully as possible. It is not necessary to delay where arrests haven’t yet been made, or where other agencies are still carrying out their investigations. The report should include details of actions already taken by the charity or what actions are planned at the time of reporting.

If something goes wrong in your charity, it is vital that the trustees:

• Prevent further loss or harm
• Report to the Charity Commission and other agencies
• Plan what to say to your staff, the media, stakeholders and beneficiaries
• Review what has happened and put measures in place to prevent it from happening again

The report can be made using the ‘report a serious incident’ online form on the Charity Commission website. It is also worth noting that the charity Annual Return asks you to declare that all serious incidents have been reported to the Commission. If you haven’t made a report, you can’t make this declaration.

Once the Commission has received your report they will notify you and give you a reference number. The report will be assessed and you will be notified of the outcome.

If you have any concerns or would like to speak to us about protecting your charity from fraud, please contact [email protected]

FEATURING: Louise Bridgett
Louise is a director working in our Plymouth office not-for-profit team. She qualified with PKF Francis Clark in 2000 and re-joined us in 2012, after five… read more
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