AN INVESTIGATION INTO the Peter McVerry Trust (PMVT) has identified “inappropriate transfers” of funds and failures in board oversight in the management and administration of the charity and its assets.

The Charities Regulator today published an inspectors’ report into the charity following its investigation, which was commissioned last year after the charity confirmed it was experiencing “cashflow pressures”. 

This prompted the Government to allocate up to €15 million in emergency funding to the charity, which was established by Fr Peter McVerry in 1983.

The investigation found a lack of “adequate and appropriate financial” controls with which the board could exercise control over the affairs of the charity.

It also identified a “failure to adhere to donor intention” in how donated funds were used.

“The inspectors identified numerous instances of inappropriate transfers and co-mingling of funds between restricted and unrestricted funds, as well as the unauthorised use of restricted funds for operational purposes,” the report states.

“This demonstrates a lack of financial oversight and consideration of donor intentions by the board as to how restricted funds ought to have been utilised.”

The inspectors found that a religious order donated money to PMVT for a specific charitable purpose and funds were to be restricted for this use, but the charity did not use the donations for this purpose. 

Of the donated funds, €1 million was used to pay the charity’s creditors. “No explanation was provided as to how the transfer of charitable funds to a separate entity advanced PMVT’s charitable purpose,” the report states.

“The Inspectors are of the view that such a transfer may demonstrate that PMVT was not applying all of its property in furtherance if its charitable purpose.”

Further findings relate to the process by which the PMVT took over other charities.

The report states there was no documented evidence as to whether the Board considered whether the charitable purpose of charities being taken over aligned with its own charitable purpose.

‘Material inaccuracies’

The inspectors cite one case where the charitable purpose of the charity being taken over was the advancement of religion, which is not one of PMVT’s charitable purposes.

The report found “material inaccuracies” in the recording of the charity’s assets, including examples of duplicate properties and the inclusion of properties which, per the Land Registry, are not currently registered as owned by PMVT.

It also found inadequate management accounts which did not report the level of debtors, creditors or debt financing. 

The inspectors found no evidence of active management of conflicts of interest, and competitive tendering procedures for services and contracts to ensure value for money were not implemented or adhered to. 

The investigation by the Charities Regulator is one of two probes into the PMVT. The other is being conducted by the Approved Housing Bodies Regulatory Authority related to its activities as an approved housing body. 

Charities Regulator chief Madeleine Delaney said the report underlines the importance of a charity’s board of trustees exercising proper control over the operations of a charity.

She said charity trustees must make sure systems and processes are in place to ensure they get the information they need to oversee all the charity’s activities.

“The report highlights the detrimental impact on a charity when this does not happen, which can have implications for public trust and confidence in the wider charity sector,” Delaney said. 

“The Charities Regulator will follow-up with the board for assurances that the matters raised by the inspectors are properly addressed.”