Extract from the Charity Commission report on Knights
Millennium Foyer Limited (KMF) and Knights Institute of Sport (KIS).
9. The Commission revealed evidence of misconduct and mismanagement. The Chief Executive of KMF also held himself out to be Chief Executive of KIS, which is an unincorporated association. In excess of £345,000 had been taken out in cheques from the bank accounts of KMF and KIS, made payable to cash and signed by the Chief Executive of KMF and KIS as sole signatory, without documentation to evidence the use to which these funds were put. The trustees put forward the explanation that the building had been decorated and items such as food and clothing materials had been paid for in cash.
10. The Commission found that KMF had entered into a Memorandum of Understanding (‘the Memorandum’) on 18 December 2000 with Knights Corporation Limited (‘KCL’), a private company whose sole director was the Chief Executive of KMF, to pay £9,050 a week in cash to KCL for services. There were no minutes recording the trustees’ decision to enter into the agreement. A copy of the Memorandum was provided to the Commission but there was no record of professional advice having been taken with regard to its terms. The Commission formed the view that the terms of the Memorandum were unfavourable to KMF and, furthermore, that KCL was fulfilling only a fraction of its duties to KMF under the terms.
11. The Chief Executive was a director of KMF, until he resigned as director on 5 August 2003. The Chief Executive was paid a salary out of the £9,050 a week payment from KMF to his private company, KCL. He was, therefore, in breach of clause 5 of KMF’s governing document, which states that, “no trustee shall be appointed to any office of the charity paid by salary”.The Full Charity Commission Report into Knights Millennium Foyer Limite and Knights Institute of Sport
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Knights Corporation Limited was struck off by the Registrar of Companies, having never filed accounts
AND FROM THE ACCOUNTS OF KNIGHTS MILLENNIUM FOYER LIMITED, SUBSEQUENTLY SUBMITTED BY THE YMCA, WHO WERE APPOINTED TO TAKE OVER (after Mr McBean had resigned and left others to carry the can)