Scandal-hit aid charity gave just 13p in every pound to charity
A controversial charity has been declared bankrupt after spending just 13p in every pound on charitable activities.
Uddingston-based Scotia Aid Sierra Leone was reported to the charity regulator in 2015 by a whistleblowing trustee who complained to authorities that directors were paying themselves huge fees at the expense of the cause they were meant to support.
Last year the Office of the Scottish Charity Regulator (OSCR) launched an inquiry into the - organisation, and placed an interim freezing the charity’s bank accounts.
It led to directors Kieran Kelly and Alan Johnston being barred from running any charity for life in January.
However, founder Dan Houston quit as chairman before the OSCR probe. According to Scotia Aid's accounts, he once paid himself £104,000 in "consultancy fees".
Now Scotland’s Accountancy in Bankrupty has served a winding up order, bankrupting Soctia Aid with debts of more than £1m.
The charity applied for bankruptcy earlier this month after running up debts of £1,107,800. Scotia Aid declared that its total assets are worth just £2,348.
In 2015 TFN told how the charity’s directors would take over empty commercial premises and lease them back to the leaseholders.
As businesses still have to pay rates on empty premises, former employees claimed Scotia Aid would go into partnership with these companies, taking over the premises for a fee significantly less than the usual local authority rates.
It meant struggling businesses who were having to pay hundreds of thousands of pounds each year in rates were only paying a fraction.
And it meant Scots Aid rceived huge amounts of cash in return.
Its annual report in 2014 showed these deals made it nearly £900,000.
Former cardinal Keith O’Brien – an ex-patron of the charity – raised concerns about Scotia Aid as far back as 2011.
The regulator opened a statutory inquiry into Scotia Aid in 2014 and published an interim report in July last year. The charity had already been subject to an investigation by South Lanarkshire Council.
The council investigation found that only 13p in every pound was being spent on charitable activities. OSCR found that payments had been made by the charity to companies connected to trustees.
It found those payments were “excessive and have not been sufficiently explained”.
A spokeswoman for OSCR said: “We can confirm that we continue to have an ongoing enquiry on Scotia Aid Sierra Leone.
“The judicial factor appointed by the court at our request continues to run the charity. We will update our report as appropriate.”
