Charity Fraud

What is Charity Fraud?

Charity fraud is a blanket term for a variety of incidents that involve fraudulent behaviour relating to charity. Charity scams can be internal or external. Employees, volunteers or trustees are typically the culprits in internal charity fraud cases. However, external charity scams may be carried out by fake charities frauding the public, or fake companies frauding the charity.

Internal Charity Fraud Cases

These are two common examples of internal fundraising scams:

• Misuse of funds

This occurs when someone working within a charity handles charity funds dishonestly. This could include stealing charity money or using credit cards for unauthorised payments.

• False expense claims

This form of charity fraud occurs when expenses are incorrectly claimed for more money than was spent, siphoning funds from the charity into personal accounts.

External Charity Fraud Cases

External acts of charity scams include, but are not limited to, the following examples.

• Invoice fraud

Invoice fraud involves external activity whereby fraudsters pose as suppliers and send invoices to charities. The charity then intends to pay their supplier but, unknowingly, pays the fraudster instead.

• Unauthorised funding

Unauthorised funding happens when individuals pretend they are raising funds for a charity, convincing members of the public to donate to a legitimate cause, only to keep the money for themselves.

Charity Fraud Court Process

If you have been accused of defrauding a charity, you may have already been charged or arrested. Whatever situation you may find yourself in, the legal process for dealing with charity fraud cases can be lengthy and intimidating. Charity scams are taken very seriously and, as a defendant, it is important to know your options. The law around charity fraud complies with the Charities Act 2011 and is complex. Therefore, we would strongly urge you to seek legal counsel and representation from a lawyer who is well-versed in this area of law.

The process begins with a report to the police from someone suspecting foul play. Suspected charity scams are then investigated by the police and possibly by the charity commission; this can include financial experts who are given access to accounts and conduct within the charity.

As well as the inspection of records and devices, each person that works for the charity will be interviewed by the charity commission to collect necessary evidence.

In the event of confirmed charity fraud, the suspected perpetrator is arrested and charged, followed by an interview conducted by the police. Depending on the evidence found, a court case follows.

Charity Fraud Sentencing

If you are found guilty of charity scams, you could face anything between three months and ten years in prison. You may also be required to return the funds you stole. Sentencing in charity fraud cases depends on the particulars of the crime, which is why we advise defendants to seek legal counsel from an expert in charity fraud cases.

Experts in Charity Fraud Cases

At St Pauls Chambers, our specialist barristers are experts in charity fraud cases. We can advise you on the investigative process of charity scams and provide comprehensive support throughout. If you are facing a charity scam investigation or need advice with charity fraud cases, contact us today.

For more insight into avoiding charity fraud cases, please see below.