Regulator critical of former trustees at Coventry City of Culture Trust

The Charity Commission concluded that former trustees at Coventry City of Culture Trust failed to oversee finances properly, citing inadequate budgeting during COVID-19, lack of scrutiny over sustainability, and delayed reporting of financial risks. The regulator found no evidence of misuse of funds or payments to connected parties but determined these failures amounted to misconduct and mismanagement. The trust was set up to manage Coventry’s City of Culture bid and events but was removed from the charity register after entering administration with significant debts, including a £1.5 million loan from Coventry City Council.

The Commission’s investigation revealed the charity may have been insolvent before securing a £1 million loan in 2022, which it could not repay. Trustees resigned after disagreeing with the loan decision, and the Commission used legal powers to obtain financial records. While the pandemic negatively impacted the charity’s operations, the Commission stated this did not fully explain its financial collapse, emphasising the trustees’ responsibility for oversight.

The Charity Commission acknowledged the pandemic’s adverse effects but criticised trustees for late financial decisions, including the unrepayable loan, and for not acting as responsible stewards of public funds. The regulator noted its limited ability to take action against dissolved charities or former trustees except in serious cases, though it deemed the failures here significant enough to warrant criticism.

The Commission stressed the importance of financial diligence for trustees, stating its findings should serve as a reminder to others. It confirmed no evidence of personal gain from charitable funds but highlighted serious shortcomings in governance. The regulator reiterated its role in ensuring charities operate with integrity and public trust.