Facts have emerged on why the founder of UK-based Kingsway International Christian Centre, Pastor Mathew Ashimolowo had problems with the UK charity commission some years ago and why the trusteeship of his church was sacked.
Church Times leant from an independent reliable source that the donation of a car bought with the church fund, as a birthday gift to him on his 50th birthday by the church leadership was part of the reasons among other reasons that made the UK Charity Commission step into the affairs of the church.
The Commission questioned why church money should be spent to buy a car for him since he was a trustee of the church and had not been granted a waiver to draw money from the church.
The source maintained that in the UK money given to a church registered under the Charity Commission is regarded as public money and it’s not meant to be spent frivolously.
Under the UK Laws Ashimolowo was entitled to apply for a waiver in order to earn income as a trustee.
But for personal reasons, he preferred not to draw money from the church as salary and he applied himself to other ways of generating income for his personal purposes such as book publishing and other businesses.
He, however, remained a trustee and was not paid any remuneration by the church.
At his 50th birthday, the elated church leadership decided that he deserved something special, a car gift among other things.
However, that drew the attention of the charity commission which insisted as a trustee he could not be given such car for private purpose as there was no evidence that there was any special grant of waiver in place for him to receive such gift as a trustee. And as a fallout, the trustees of the church were sacked and interim managers (a professional accounting firm) were appointed.’
The managers were basically concerned about the integrity of the fund of the charity and corporate governance of KICC as a charitable organization.
The church still ran and services held as usual. However, the interim managers were paid from the church funds.
By the time the managers were through, part of their recommendation was that there was the need to reorganise the administration of KICC to fit in with their then-current administrative realities which was why KICC became a company Ltd by Guarantee; with a board of directors and salary structure for its operatives like every other corporate organisation.
Findings on the internet by Church Times, however, indicated that the issues were deeper than that. A publication by Gov.UK linked the sacking of the trustees to an investment deal that went awry. The car gift to Ashimolowo by the Church leadership perhaps fueled a deeper enquiry which linked the Church to a wrong investment.
The Charity Commission in a published inquiry into Kingsway International Christian Centre (KICC) (charity number 1102114) in 2011 identified concerns over an investment of £3 million being made with one of the then trustees of the church
The Commission according to the published report liaised with the then Financial Services Authority and established that the individual was not authorised to carry out regulated activities (such as dealing in or managing investments).
“This raised serious concerns as the charity had made substantial investments through the individual which appeared to be speculative and high risk in nature.”
The Commission then used its legal powers to direct the charity to stop any further investments “The Commission’s inquiry established that the trustees who were in place at the time had invested a total of £5 million of the charity’s funds, which subsequently resulted in a net loss of £3.9 million to the charity.
“The Commission appointed an interim manager on 31 January 2014 to review decision making in relation to the investments, establish whether there was any potential personal liability and, if so, whether any restitution was appropriate and in the charity’s best interests.”
The inquiry concluded that the trustees who made the investment were responsible for mismanagement in the administration of the church.
The Commission’s conclusions according to the report “include that the trustees who were in place at the time of the investment failed to:
“Exercise sufficient care when making the decisions to invest a total of £5 million of the charity’s funds through the trustee’s investment scheme
“Ensure they were sufficiently informed and take into account all the relevant factors – they could not show that their decisions were based on sufficient and appropriate evidence particularly as they did not seek proper independent advice on high risk, a high-value investment scheme
“Manage conflicts of interest when making the decision to invest – there was too much reliance on the expertise of the trustee when he was personally interested and conflicted in the decision to invest charity funds through the trustee’s investment scheme
“The Commission concluded that a prudent person acting with due care would have been concerned that the promise of a fixed rate of return of 55% per annum for the investment was an unusually high rate and likely not to be achievable on a long-term basis.”
1 comment
Where is the biblical injunction of godliness with contentment? Is the expectation of a 55% ROI an overkill and an outright display of greed or call it stupidity?
The Commission concluded that a prudent person acting with due care would have been concerned that the promise of a fixed rate of return of 55% per annum for the investment was an unusually high rate and likely not to be achievable on a long-term basis.”