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Published: Saturday February 27, 2016

3rd Sector fraud - FAP Guidance

Trustees have a legal duty and responsibility under charity law to protect the funds and other property of their charity so that it can be applied for its intended beneficiaries.

They must also comply with the general law (and overseas law where applicable) including in relation to the prevention of fraud, money laundering and terrorist financing. Fraud will flourish in an environment of weak governance and poor financial management. So this means that the protection of charity funds begins with having robust financial control systems within a framework of strong and effective governance.’

So says the Charities Commission and we at CFIL totally concur. The consequence of failing to acknowledge the risks charities face can (and has) have dire consequences. Those involved in the systematic attacks on businesses know that the 3rd sector is fertile ground for two main reasons. Firstly, in general, charity work attracts good people- trusting and committed individuals who may be unintentionally blind to the dangers individuals with far less scruples may present. Secondly charities exist to give not profit and so costs are kept to a minimum meaning that expenditure on counter fraud systems generally are not as robust as those in the financial and corporate sectors.

The Fraud Advisory Panel have just published an informative report for the 3rd sector. Tackling-fraud-in-the-charity-sector-conference-summary-February-2016

CFIL have experience in the issues that face 3rd sector organisation and are able to provide briefings and educational opportunities which translate directly to the workplace. Contact us for more information.

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