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Struck off charity received $150,000 Government grant

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Centre Against Abuse co-chair Damon Wade (Photograph by Sarah Lagan)

An organisation providing “critical services” to victims of domestic abuse is in financial crisis – despite receiving taxpayer cash to carry out its work.

The Centre Against Abuse, co-chaired by former Progressive Labour Party chairman Damon Wade, received a $150,000 grant from the Ministry of Legal Affairs in 2020, although it had been removed from the list of registered charities and owed payroll tax to the Government.

It says it has been earmarked for another publicly-funded grant but The Royal Gazette is aware of concerns within the Registry General – the government department tasked with oversight of charities – about its management.

The Gazette can reveal the organisation was taken off the charities list – and has yet to be reinstated – because it failed to file audited financial statements after selling its shelter in July 2017 to raise funds.

Some board members were initially unaware it had been removed from the list and members of its finance committee quit because of concerns about the way the CAA was being run.

The revelations are likely to focus attention on regulation of the island’s third sector and raise questions about how an organisation owing money to the public purse can receive taxpayer-funded grants.

The CAA’s financial woes are longstanding and have been documented before, including in 2014 when the charity announced it was closing its shelter – the only safe house here for domestic violence victims – due to a lack of resources.

But its removal from the list of registered charities, its debt to government and the internal conflict which led to board members resigning, have not previously been reported.

The island’s Charity Commissioners discussed the organisation’s problems at a November 2016 meeting, according to minutes obtained by the Gazette under public access to information.

The minutes state CAA had “been operating at a loss for the past four years. There is a growing concern over the continuous losses and the commissioners require information on how they plan to place the organisation on a more financial footing going forward.”

The $1 million sale of the Paradise Cottage shelter in St George’s was supposed to enable CAA to “pay off all [its] outstanding debts, as well as have a cushion for future use”, according to a letter executive director Laurie Shiell wrote to the Registry General in early 2017.

Laurie Shiell, the executive director of Centre Against Abuse (Photograph supplied)

But an independent auditor’s report from June 2021, covering the organisation’s financials for the year ending March 2018, suggests otherwise.

The report, seen by the Gazette, notes that the Centre “incurred losses of $204,621 during the year ended March 31, 2018 and, as of that date, the Centre’s current liabilities exceeded its total assets by $50,544”.

The auditors state: “These conditions … indicate the existence of a material uncertainty that cast significant doubt on the Centre’s ability to continue as a going concern.”

The Centre was given temporary charitable status in summer 2020 but records obtained by the Gazette show it again failed to file the required financial paperwork afterwards.

A request for another temporary licence was turned down in October 2020.

The CAA was still describing itself as a registered charity and seeking donations on its website until last month – when it took down the information after it was flagged up by The Royal Gazette.

Mr Wade and co-chair Lorna Dixon-Marable said in an e-mail: “We have not deliberately solicited funds since the expiration of our temporary licence.

“Our website page has now been updated, as it was an oversight on our part. However, we can confirm no donations were made through the site since the expiration of our temporary licence.”

They confirmed that CAA was removed from the charities registry "due to unaudited financials for the 2017 fiscal year“.

The pair said once the board became aware of the removal from the list it “immediately engaged” a local accounting firm for an audit and the Charity Commissioners granted a temporary fundraising licence "given their knowledge of our audit in progress“.

“The audit process was scheduled to begin in July 2020,” said the co-chairs.

“Unfortunately, the pandemic and shelter-in-place orders delayed the scheduled start and completion of the process. The audit was finally completed in January 2022.”

The co-chairs said the CAA was allocated another government grant in the 2021-22 budget but “those funds are pending our reinstatement to the list of registered charities”.

They said: “In January this year we submitted everything that has been asked of us to be reinstated and are simply waiting on the decision of the Commission.

“We are grateful for the Government’s recognition of our services to the community, demonstrated by the awarding of another grant, and we are hopeful the Commission’s decision-making process will be completed shortly so that we can receive the much needed funding.”

The co-chairs added: “This process has been long and painful for our organisation but through some reorganisation and sacrifice we have still managed to service the people of Bermuda without missing a step, despite our lack of funding.”

They stressed the Centre, founded more than 40 years ago, was the only organisation here offering 24/7 help to domestic abuse victims.

“We are proud of the service we provide for our clients and their families and will continue to offer the services to help those in need.”

Mr Wade and Ms Dixon-Marable did not answer further e-mailed questions.

A Government spokeswoman said CAA was removed from the list in 2018 because of “non compliance with legislative requirements” and would have been warned beforehand.

She said: “ … in 2020, because of pandemic-related restrictions and anticipated increases in domestic abuse, it was determined that the charity's work would provide a critical service to the community.

“And so, in May 2020, it applied for and was granted a temporary fundraising licence and the charity received a grant of $150,000.”

She said CAA’s charitable status remained “under review” and would not comment on whether it owed payroll tax to the Government.

To read a Q&A with the Government about Centre Against Abuse, click on the PDF under Related Media.

Timeline

August 2014: The Centre Against Abuse’s safe house for victims of domestic violence closes due to a “critical” shortage of money.

February 2015: The charity is awarded a government grant of $75,000.

November 2016: The Charity Commissioners note that the organisation has been operating at a loss for the past four years and ask how it plans to improve its finances.

July 2017: The shelter is sold for $1 million.

November 2018: CAA is still on the list of registered charities.

January 2019: The organisation no longer appears on the list.

January 2020: The Charity Commissioners defer CAA’s application to be reinstated to the list pending receipt of audited financials for 2017.

February 2020: A grant of $150,000 is awarded to CAA by the Ministry of Legal Affairs.

May 2020: A temporary three-month fundraising licence is issued.

October 2020: A request for a further temporary licence is turned down.

June 2021: Independent auditors say there is “significant doubt on the Centre’s ability to continue as a going concern”.