The regulator found serious misconduct and/or mismanagement in the administration of the charity due to poor financial management and governance.

The Commission’s inquiry found that the charity had made payments totalling £129,800 to Dasim Partners, a property development company of which two trustees, Sidney and David Chontow, were partners.

The charity’s objects included the relief of poverty, assistance of the elderly, the advancement of education and the advancement of religion.

In 2013, Achiezer was included in a class inquiry conducted into charities which have defaulted on their statutory filing obligations with the Commission on two or more occasions in the last five years.  During this class inquiry, concerns were identified about Achiezer’s governance and financial management. The Commission opened a statutory inquiry into the charity in June 2015.

The inquiry concluded that the trustees had not managed the conflicts of interest, as there were no independent trustees, and the basis of these payments was unclear.

The regulator also concluded that one of the trustees, Sidney Chontow, had obtained personal benefit. Potential Investment Portfolio, of which Sidney Chontow was a partner, attempted to avoid paying £59,000 of business rates to Bury Metropolitan Borough Council, by letting out property to the charity. Potential Investment Portfolio would be liable for business rates on an empty property, whereas property used for charitable purposes is exempt. The charity became liable for the business rates when it was found that the property was not used solely for charitable purposes and therefore was not entitled to an exemption.

The inquiry also found that the trustees failed to properly manage the charity’s funds and did not distinguish between the charity and other entities with which they were connected. The trustees did not effectively manage conflicts of interest, allowing numerous complex transactions to be made to related organisations and their personal companies.

The Commission concluded that the trustees’ actions constituted serious mismanagement and/or misconduct. Sidney and David Chontow were removed as trustees in August 2020, and thus disqualified from acting as a charity trustee. Interim managers were appointed to the charity in October 2018 to take over the operational management, governance and administration of the charity, and secure the charity’s property and assets.

Sidney Chontow paid the outstanding business rates to Bury Council and the charity’s remaining funds, amounting to over £400,000, were distributed to charities with similar charitable aims. The charity was wound up and removed from the Commission’s register of charities on 7 April 2022.

Amy Spiller, Head of Investigations at the Charity Commission said:

Trustees should manage their charities effectively and responsibly, including ensuring financial decisions are taken in the best interests of the charity.

The Chontows abused their position as trustees, to derive personal gain for themselves and their businesses to the detriment of the charity. It is right that they were removed as trustees, and that this charity has ceased to operate.

ENDS

Notes to Editors

1. The Charity Commission is the independent, non-ministerial government department that registers and regulates charities in England and Wales. Its purpose is to ensure charity can thrive and inspire trust so that people can improve lives and strengthen society.
2. The Commission opened the inquiry on 23 June 2015, following a class inquiry opened on 11 November 2013.
3. View the full inquiry report.
4. The class inquiry into the other charity which had the same trustees, Achiezer Association Ltd, is ongoing.

Paul Richard Hubbard, 60, and Susan Ann Hubbard, 62, have been disqualified as directors for eight and six years respectively, after taking deposits in excess of £30,000 from customers despite knowing their business was insolvent.

The couple were directors of Scunthorpe-based Barningham Memorials Limited, which produced headstones and other memorial items. The company had traded since 2003 but went into liquidation in March 2020.

However, the company was in fact insolvent from August 2019, yet continued to take payments and deposits from would-be customers despite knowing it would not be able to provide the finished products. In total, the company took over £30,000 from 41 customers during this period.

The company had previously been hit by a five-year ban by North East Lincolnshire Council in 2015 for a failure to adhere to local regulations. From this point on it was forced to rely on subcontractors to install memorials.

The Secretary of State for Business, Energy and Industrial Strategy accepted disqualification undertakings from both directors, after they did not dispute that they had been responsible for the company continuing to take money from customers while it was insolvent. Paul Hubbard has been banned for eight years, and Susan Hubbard banned for six years, both effective from 3 August 2022.

The disqualification undertakings prevent them from directly, or indirectly, becoming involved in the promotion, formation or management of a company, without the permission of the court.

Rob Clarke, Chief Investigator at the Insolvency Service said:

Any business in financial difficulty should be aware that its primary duty is to its creditors, and ensuring that their losses are minimised.

In continuing to accept pre-payments for memorials which they had no reasonable prospect of supplying, Paul and Susan Hubbard have caused additional pain to grieving families over and above the purely financial loss.

Notes to editors

Paul Richard Hubbard and Susan Ann Hubbard currently reside in Scotland. Their dates of birth are July 1962 and July 1960 respectively.

Barningham Memorials Ltd – company registration number 04713249.

Disqualification undertakings are the administrative equivalent of a disqualification order but do not involve court proceedings.

Persons subject to a disqualification order are bound by a range of other restrictions.

Information about the work of the Insolvency Service, and how to complain about financial misconduct.

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Levelling Up Secretary Greg Clark has today (19 August 2022) announced he will set up a strategic advisory panel to develop a long-term plan to guide Liverpool City Council out of the current government intervention and help shape the future of the city, alongside confirming he is “minded to” expand the intervention in the council, in response to the latest report from commissioners.

The Liverpool Strategic Futures Advisory Panel will work closely with the City Mayor Joanne Anderson and her Cabinet, and also with the commissioners, to help the council make the right decisions and to develop a plan to give long term confidence in the future of the city, beyond the current temporary intervention. The panel will have a particular focus on driving growth in skills, jobs and opportunities for the city.

The Panel will be chaired by Steve Rotheram, metro Mayor of Liverpool City Region. He will be joined by two of the most experienced people in city leadership, Sir Howard Bernstein, Chief Executive of the City of Manchester from 1999 to 2017, and Baroness Judith Blake, Leader of Leeds City Council from 2015 to 2021. The Panel will be asked to nominate an experienced business leader to join them.

Using their expertise and knowledge, the Panel will work closely with Mayor Joanne Anderson and her Cabinet, members, and wider partners, as well as with the commissioners to support the council to make the right decisions and employ its resources to bring long-term confidence and meet the ambitions of the people of Liverpool.

This further step comes after the report on the council’s progress revealed serious shortcomings, particularly around financial management and senior leadership. It also criticised the slow progress made in driving improvement measures that were highlighted in the commissioners’ second report.

Four commissioners were sent into Liverpool City Council in June 2021 to oversee the Council’s highways, property and regeneration functions. They submitted a second report into the council’s progress on 10 June 2022.

Following the report, in addition to setting up the new Strategic Futures Panel, the Secretary of State is announcing that he is minded to appoint a commissioner to oversee the authority’s financial management and to transfer functions associated with governance and financial decision-making to the commissioners together with powers regarding recruitment to improve the running of the organisation.

Levelling Up Secretary Greg Clark said:

I am determined to help do everything I can to help Liverpool come out of the current intervention stronger and able to achieve its ambitions.

The commissioners’ report shows that there are still serious shortcomings that need to be sorted out, especially in financial management. But I want this to be a turning point at which the City of Liverpool can see a bright future that lives up to the power this great city embodies.

So following talks I had in person in Liverpool with Mayor Joanne Anderson and Mayor Steve Rotheram in recent weeks, I am appointing a new panel, chaired by that same Mayor Rotheram and supported by some of the wisest, and most experienced people in city leadership, to lead this transition from current interventions to a successful future.

Lead Commissioner Mike Cunningham QPM CBE said:

Our report outlines the challenges the council has faced over the past year in their improvement journey, and highlights some of the areas that need urgent improvement. We welcome the Secretary of State’s decision to expand the directions, and the creation of the Strategic Futures Panel. We have confidence that the council can now address these challenges.

Liverpool City Council and other interested parties will have until 2 September to provide representations on these proposed intervention measures.

On 10 June 2021, the government intervened in Liverpool City Council, appointing four commissioners to oversee the councils’ highways, property and regeneration functions of the council at the request of the former Secretary of State.

They are:

• Mike Cunningham QPM CBE (Lead Commissioner) – Mike has been involved in policing for more than 30 years, most recently as Chief Executive of the College of Policing from 2018 – 2020, the standards setting body for policing in England and Wales. Formerly one of Her Majesty’s Inspectors of Constabulary, inspecting forces in the north of England and Northern Ireland, and the national lead inspector for the development and implementation of inspections into police efficiency, legitimacy and leadership, and Chief Constable of Staffordshire Police.

• Joanna Killian (Local Government Improvement Commissioner) – Joanna has more than 30 years of experience in the public sector delivering transformational change and service improvement. Since March 2018 she has been Chief Executive of Surrey County Council. Prior to this Joanna worked at KPMG and was also Chief Executive of Essex County Council for 9 years.

• Neil Gibson (Highways Commissioner) – Neil is the former Executive Director of Transport Economy and Environment for Buckinghamshire County Council, where he also acted for a time as Interim Chief Executive. Neil is also a Fellow of the Chartered Institute of Highways and Transportation and former President of the Association of Directors of Environment, Economy, Planning and Transport.

• Deborah McLaughlin (Regeneration Commissioner) – Deborah has extensive experience working in Regeneration and Housing for over 30 years across public and private sectors, including as Director of Housing at Manchester City Council, regional director for the North West at Homes England and Director of Capita’s real estate business. Deborah has also previously worked at the Audit Commission as a Best Value Inspector and auditor.

The Liverpool Strategic Futures Advisory Panel

On 19 August, Levelling Up Secretary Greg Clark announced the creation of the Liverpool Strategic Futures Advisory Panel. The Panel will work closely with Mayor Joanne Anderson, her Cabinet, members, and Liverpool City Council’s commissioners.

The members of the panel are as follows:

• Mayor Steve Rotheram (Chair) – Mayor Rotheram has been the metro Mayor of the Liverpool City Region since May 2017. He will convene and chair this panel as part of his role as Mayor.

• Sir Howard Bernstein – Sir Howard was Chief Executive of Manchester City Council from 1999 to 2017 and is synonymous with success in regeneration, business investment and negotiations on devolved powers.

• Baroness Judith Blake CBE – Baroness Blake was Leader of Leeds City Council from 2015 to 2021 and has experience of leading a major city with a good record of attracting new investment