Communitybuilders and money-laundering

Now I’m not in favour of money laundering.  Indeed it’s fair to say I’m against it.  Therefore, I suppose, I’m in favour of steps which mitigate against money laundering.  However Communitybuilders really truly do go a step too far.  Several steps too far.  Many many many steps too far.

Is it worth ranting about Communitybuilders?  They are, after all, one of the victims of the “bonfire of the quangos” and will disappear after March.  But in the meantime, wouldn’t it be reasonable to assume that their one remaining function is to get the remaining money out there as straightforwardly as possible, to as many successful applicants as possible?  Yes, it would.  The reality however is rather different.

I was working on a fundraising project for a new-build community centre.  We had hoped to apply for a Main Stage grant from Communitybuilders, for funds (part grant, part loan) towards the actual buiding.  Then in September 2010, once the quango-cuts had been announced, Communitybuilders were told that all their funds had to be allocated by March 2011 and spent by March 2012.  That would probably be OK, as our Feasibility Grant application had just been submitted, and if successful would be rapidly followed by the Main Stage grant application, hopefully to be allocated funds by March 2011.

But no, a further change of instructions from the government meant that in November 2010 we were told that all Main Stage funds now had to be SPENT by March 2011 – clearly impossible for our project.  Never mind, our Feasibility Grant application had been successful so we had some funds for a major external reality check – some expertise to revisit the Business Plan and the funding strategy in the light of the recession and the closure / changed priorities of some of the major capital funders.

Excellent.  Then the paperwork arrived.

First the Trustees were required to pass a Special Resolution accepting the funds, agreeing only to spend it on what it was for, and nominating two Trustees to be the named people who could sign the acceptance letter.  The short deadline for this resolution to be passed, signed, and returned to Communitybuilders meant a special Trustees’ meeting had to be convened.  The two nominated Trustees then had to complete the Money Laundering / Fraud Prevention forms.  This required them to provide proof of who they are (eg passport or driving licence), and proof of where they live (eg utility bill, council tax demand).  The ORIGINALS of these document must be sent to Communitybuilders.  HUH?  Who sends their passport or driving licence off to a funder?  Ah, there’s an alternative.  Photocopies will be accepted, but must be signed as a true copy by a solicitor.  HUH???  And all this by the end of February.  Along with the certificate of incorporation of the Company Ltd by Guarantee.

The Trustees are, of course, volunteers.  Most have other jobs.  Some may be sick, disabled, housebound etc.  These demands are really excessive.  Had the timings not changed, and had we made a successful Main Stage application for – say £500,000 – it would be a reasonable and proportionate requirement.  Our successful grant, for which all this was required, was for £12,000, and was anyway only going to be paid on completion of the revised business plan and funding strategy and submission of the actual invoices. 

Where is the sense of proportion here?  Even Awards for All simplified their process to remove the need to provide signatories certified by the bank at application stage (see blog Favourite funding sources – update: Awards for All simplifies! for details).  I’d lobby Communitybuilders to change their procedures, but it’s just not worth it.  Let’s see if the government’s new funds for social enterprise, the voluntary sector, and the Big Society are any more straightforward.  Are you holding your breath?

©  Tamara Essex 2011

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2 Comments on “Communitybuilders and money-laundering”

  1. Marc Says:

    Leaving aside the fact that many funding bodies seem forget what their root definition is and see themselves more as gate keepers, the really worrying thing is the monkeyseemonkeydo mentality of copying somone elses policy ( without thinking if it’s workable) and the blatant ignoring of the law , just because that’s what other people do( it’s illegal to take a copy of a passport). The presumption that trustees and volunteers really have nothign better to do is embedded within the civil service style mentality. Locally and umbrella voluntary body has orgnaised a series of “roadshows” to help charities access “hidden” funds, representaives from various funders would be there over 4 days , between 2-5pm! I wonder if when they get a low takeup they will consdider that there is low demand?

  2. Steve Doerr Says:

    What would be really nice is, if some of our money hasn’t been disbursed by the deadline, we get it back. Ain’t likely to happen though.


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