Charity Commission clears Hindu charity of funding terrorism
31 August 2010

The Charity Commission, the independent regulator of charities in England and Wales, has published a report on its inquiry into the charity Sivayogam which runs two Hindu temples in London providing religious facilities to the local Hindu Tamil community and collects donations for educational and welfare organisations in Sri Lanka. The Commission opened a statutory inquiry after a number of concerns were raised with the regulator about the application of the Charity's funds in Sri Lanka - some of which were thought to have been channeled to the terrorist group, the Liberation Tigers of Tamil Eelam (LTTE) - and the Charity's governance arrangements.

The Inquiry was opened on 20 March 2007 and its substantive investigative phase concluded on 10 July 2009. The case was closed on the publication of the Commission's report on 31 August 2010. During the Inquiry period, the charity was not permitted to make any payments worth more than £500 without the consent of the Commission and one of its trustees, Nagendram Seevaratnam, was removed from office. Mr Seevaratnam was reinstated after the charity tribunal quashed the Commission's order in 2009, but he stepped-down after his 15-year term expired.

As a result of the Commission's Inquiry, the Charity has strengthened its financial controls to protect its funds from the risk of misuse or misapplication. The trustees have conducted a review of the Charity's due diligence procedures in relation to international grants and donations, to ensure the more effective application of funds held and applied by the Charity. The implementation of guidance given by the Inquiry will strengthen the Charity's financial controls and protect its funds from the risk of misuse.

The report contains a number of important wider issues for the charity sector. It highlights the duties and responsibilities of charity trustees, in particular their duty to put in place and monitor proper governance and decision making procedures. The wider issues set out in the report include specific guidance relating to the duties of charity trustees when working internationally, and when operating interest-free loan schemes.

Click here to download a copy of the Charity Commissions report from the Sivayogam Inquiry.