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Richard King

Posted 26 January 2018
by Richard King

Would You Return a ‘Tainted’ Donation?

Money stacked.

On learning from a press report that an annual men-only fund-raising event run by the Presidents Club Charitable Trust was (to say the least) abusive of women, Great Ormond Street Hospital has vowed to return all the money it has received from that source (reputed to be some £½ million). Other children’s charities are following suit.

The Charity Commission and the Fundraising Regulator are looking into the events held by the Club, which is now to be wound up. Although some commentators have described this as an over-reaction, it seems generally accepted that the behaviour complained of was such that no charity would want to be associated with an event of that kind.

But how far must a charity go? It cannot be expected to monitor every fund-raising effort carried out in its name. Smaller charities may be so desperate for the cash that they will not want to enquire too closely where it came from. Even if they do, is it the beneficiaries’ fault that the money came from an objectionable practice?

The general rule is that a charity has a duty to maximise its assets and so should not readily decline any opportunity to attract funds. But that does not mean it has to accept every donation. There may be good reasons to refuse (ethics, onerous conditions, conflicts of interest, proceeds of crime, incompatible purposes, reputation etc.), but there is a danger in bowing to pressure from the press or the public if the underlying gift is genuine.

In the end, it is down to the trustees to decide whether it is in the interests of the charity to refuse, or even to repay, a donation. As always, there is a balance to be struck. Take advice.

If you require any advice regarding an issue similar to this, then please do not hesitate to contact our experienced team of charities solicitors.

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About the author

Richard King

Richard King

Consultant Solicitor

A consultant solicitor in the charities & social enterprises team