A series of failings at a Blackpool-based veterans charity have seen it shut down following an 18-month investigation.
Racist comments by a trustee, offensive items for sale and a poorly judged commercial deal were all flagged up by the Charity Commission inquiry into 1st Knights Military Charity.
The probe followed an undercover investigation by BBC Scotland, who secretly recorded a conversation in the St Annes’ Road shop.
READ MORE: Veterans charity shut down over wholly offensive items
Footage shows items, which had been hidden from public view, which were “derogatory towards those who follow the Islamic faith”, while one of the trustees – Andrew Linihan – and a volunteer made “wholly offensive and inappropriate anti-Islamic comments”, according to the investigation report.
Further “highly offensive and inappropriate” T-shirts depicting Nazi symbolism were advertised for sale on the charity’s online store, the report found.
An unannounced visit to the charity’s premises later confirmed the inappropriate items had been removed from sale, however offensive merchandise was still displayed on the charity’s online store four months after the investigation was launched in November 2016.
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.
But the report also questioned a conflict of interests over the charity’s use of a B&B owned by two of the trustees.
When questioned, they said there was never any intention to seek payment from the charity for the use of the accommodation.
However, the report, published yesterday, said 1st Knights was given an invoice for £2,678.74 for the 2014/15 financial year.
The report adds: “(The trustees) stated... it was never their intention to receive recompense. The inquiry did not consider this to be a plausible explanation.”
Despite finding no evidence of any payments being made to the trustees as part of the arrangement, investigators said they “failed to demonstrate they acted in the best interests of the charity by placing themselves in a position whereby they could receive financial benefit”.
A separate deal with a commercial company that sold prize draw tickets and wristbands to raise awareness of 1st Knights was also criticised.
The charity received just 20 per cent of the scheme’s turnover – pocketing some £55,861.40 – but investigators said it was “not clear” how the deal was in its best interests “given the low percentage of profits the charity received”.
In its report, the Charity Commission singled out Mr Linihan for criticism, saying his offensive comments and the fact he had ordered the offensive stock amounted to misconduct.
It also named another trustee, Melanie Rowley, who it said was “responsible for misconduct and/or mismanagement” for failing to intervene when the offensive comments were made.
The report added that all trustees of the charity were “jointly and severally liable” for failing to act in the best interests of the charity.
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.”
Speaking to The Gazette in 2016, when the allegations against him were first brought to light, trustee Andrew Linihan said his comment had been meant as “forces banter”.
He said: “This has been a nightmare for us.
“It is a mistake. These products should never have been on sale online or in the shop and they have all been withdrawn.
“We are not proud of what happened. We never sold many of these items and you can find them in other places in the town.
“We are a charity which supports soldiers with post traumatic stress and other conditions. They didn’t show the good work we do.
“Some of the people filmed in the shop were veterans who are struggling with PTSD.
“What they said was banter between soldiers.
“But it is not acceptable. The bottom line is that once it’s been said it can’t be taken back.
“All I can do is apologise.”