The Charity Commission has taken the action against Afghan Heroes, after uncovering a raft of management and financial failures by the charity’s trustees.

The regulator found that trustees “gained significant unauthorised private benefit” from the charity.

It emerged that four former trustees received £384m in unauthorised funding between them. This included direct payments to trustees as well as transactions to companies they had a personal financial interest in.

Further concerns focus on the charity’s fundraising and quality of support it offered to veterans with complex needs.

Two founding trustees had already been removed from their positions six years ago. Both, who passed away during the investigation, had been permanently disqualified from senior roles and trustee positions within any charity.

The charity’s work included setting up ‘retreats’ for homeless veterans by purchasing and running a network of pubs to financially support veterans.

The regulator’s investigation into the management of Afghan Heroes began in 2013 and found that the charity had lost around £337,000 through poorly managed financial deals.

This included losing £185,000 through loans to a trading subsidiary that purchased a lease for a pub in Ashcott, Somerset, that did not prove profitable.

It lost a further £40,000 in loans to another trading subsidiary to refurbish a pub in Minehead, Somerset to house veterans. However, it later transpired that the premises could not be used for this purpose.

“The public rightly expects charities to make a real positive difference for the people they help or the cause they pursue. Afghan Heroes launched with significant support and the goodwill of people in Somerset and around the country, said
Charity Commission head of investigations Amy Spiller.

“Unfortunately, the trustees lacked the understanding or expertise required to run a charity effectively. They mismanaged the charity, including by receiving personal benefits they were not entitled to.

“They effectively caused the loss of very significant amounts of charitable funds that should have been spent to support veterans with complex needs.

“We understand why those who supported this charity feel angry and let down at the waste and incompetence presided over by the trustees.

“I hope others considering setting up a new charity learn from this case, and ensure they bring on board the expertise and competence required to run a charity lawfully and effectively.”

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