From the 1 August 2018, important changes are being made to the automatic disqualification rules for charity trustees.
Under the current rules, automatic disqualification focuses mainly on bankruptcy and unspent convictions for crimes with an element of dishonesty or deception.
The new rules increase the number of reasons a person may be automatically disqualified and cover:
• terrorism related offences;
• money laundering offences;
• bribery offences;
• offences under the Charities Act for disobeying a Charity Commission order or direction; and
• offences for misconduct in public office, perjury, and perverting the course of justice
The new rules also prevent anyone who is automatically disqualified from being a charity trustee also from holding particular senior management positions in a charity, including as Chief Executive and Chief Finance Officer, or similar roles; the job titles are not key.
Academy Trusts are charities so these new rules will apply to them, and their senior executives. Also, it is important to note that offences under the Charities Act will not show up on a Disclosure and Barring Service (DBS) check, so something more is required from an Academy Trust if it is to evidence that it is aware and complying with it legal obligations.
It is a criminal offence to seek to act when disqualified. The Charity Commission can also order repayment of any expenses, benefits, remuneration or the value of benefits in kind received from the charity during the time a person was acting while disqualified.
Anyone subject to a disqualification can apply to the Charity Commission for a waiver to permit appointment (or for senior executives post 1 August, any continued appointment) at a specific charity, for a class of charities or for all charities based on the particular circumstances.
Whilst these changes may appear to be another administrative burden, it is an ideal opportunity for academies to review and update their procedures for checking the eligibility of new and existing trustees and their senior executives.
Chris Billington, Head of Education at Wrigleys notes that "It is already good practice to ask trustees to confirm their eligibility under the HM Revenue and Custom's 'fit and proper person' test and the academy trust template articles of association (it's constitution) includes some specific eligibility requirements which go beyond those applied to other charities. The new rules reinforce the need for academy trusts to question both trustees and senior executive's eligibility to hold office."
Declarations of Eligibility should be signed by prospective trustees and senior executives before their appointment to confirm that they are not disqualified from acting. Academy trusts should consider ensuring that trustees and executives are under a continuing obligation to notify if they should become, or are at risk of being, disqualified. Trusts should add the issue of eligibility to their annual update on business interests.