A charity that stocked "wholly offensive and inappropriate" items in its Blackpool shop has been shut down.
The 1st Knight Military Charity was investigated over allegations it was selling offensive products, bearing anti-Islamic messages, and a trustee had used "unacceptable" language.
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The charity was set up to support veterans who had been injured in service and provided short breaks in Spain for 17 ex-soldiers between July 2014 and August 2017.
The Charity Commission's probe followed an undercover investigation by BBC Scotland, who secretly recorded a conversation in the St Annes's Road shop. The video shows items - which were hidden from public view - that the Charity Commission said caused "irreparable damage" to the charity's reputation.
A report published today details the regulator's findings, including that 1st Knight's trustees had committed misconduct.
The report singled out two in particular: Andrew Linihan, who made "offensive" comments to the undercover reporter and had ordered the inappropriate stock; and Melanie Rowley, who had failed to intervene or challenge Mr Linihan's behaviour, the Commission said.
Further highly offensive and inappropriate t-shirts depicting Nazi symbolism was advertised for sale on the charity’s online store, the report found.
An unannounced visit to the charity’s premises later confirmed that the relevant materials had been removed from sale, however offensive and inappropriate merchandise was still displayed on the charity’s online store four months after the investigation was launched in November 2016.
A winding up order was issued and the charity was dissolved on March 23. It's remaining funds of £2,678.74 were transferred to another charity supporting wounded veterans.
Michelle Russell, director of investigations, monitoring and enforcement at the Charity Commission said: “The public rightly expect charities to demonstrate the highest standards of integrity and conduct.
"What we saw in this case fell short of that. Not only was this charity mismanaged, we also saw evidence of behaviours and attitudes that have no place in charity.
"The organisation has now wound up, and I am pleased that we have ensured its assets are redistributed by another charity.”