Fact Sheet - Investigating Charities

Fact Sheet

Charitable Fundraising

INVESTIGATING CHARITIES

Contents

What complaints are looked at?

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What is this fact sheet about?

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What complaints are looked at?

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How to alert the NSW Office of Liquor, Gaming and Racing

An inquiry / investigation will be undertaken where there is good reason to do so. For example, we will consider complaints supported by evidence that:

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Confidentiality

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What happens when we are alerted?

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Investigations / Inquiries

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What action can we take to put matters right?

What is this fact sheet about? •

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Charities (organisations authorised to undertake fundraising appeals) are supported by donations and members of the public should have confidence that their donations are applied for the purposes for which they were intended. Charities and other persons and organisations conduct community gaming activities (lotteries and games of chance) as a fundraising activity, as a social pastime or entertainment, or as a method of promoting the sale or use of products or services. We have powers of inquiry where misconduct and wrongful use of funds and assets, or mismanagement is suspected or alleged, or where non-compliance with the law is suspected or alleged. This fact sheet explains what you could do if you suspect something is wrong, what we will do, and what powers we have to investigate.

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there is misconduct or mismanagement

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the funds and assets are at risk — the funds and assets are being used or applied in breach of the purposes for which they were raised

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the public is being mislead in a material way

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unlawful charitable fundraising or community gaming activities are being conducted

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a prize won is not delivered, or is different in a material way

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persons are receiving unauthorised benefits

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proper accounts are not kept

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fundraising or administrative costs are too high

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improper activities are being undertaken.

We do not investigate criminal matters, which are the responsibility of the police to investigate under the provisions of the Crimes Act. Where an investigation uncovers criminal offences we will refer the matter to the police to consider what action they wish to take. We cannot assist you in legal proceedings taken against a charity or an organiser of a community gaming activity. We will not usually use our powers of investigation to resolve internal disputes between members of a charity or its management committee.

NSW Office of Liquor, Gaming and Racing Level 7, 323 Castlereagh Street, Sydney GPO Box 7060 Sydney 2001 Phone: 02 9995 0666 Facsimile: 02 9995 0611 Email: [email protected] Website: www.olgr.nsw.gov.au

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March 2008

INVESTIGATING CHARITIES How to alert the NSW Office of Liquor, Gaming and Racing?

contact with us about these matters •

It is usually best to write.

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However, you may wish to telephone first to help clarify issues. The matter may be able to be resolved over the phone. If you do phone always ask for the name of the person to whom you speak and their position. Tell them about the complaint, ask if we can help and what we could do. You should keep notes of this and the time and date of the call. Nevertheless, to ensure your concerns are properly addressed, write a letter and send it to us by mail or e-mail ([email protected] or [email protected]). Even if you are satisfied with your telephone conversation, it may be best to confirm your understanding of the conversation in writing. Unless you have an urgent problem, or the matter can be resolved over the phone, it is best to write. Make it clear and to the point. Summarise in a couple of sentences exactly what your complaint is. Don’t go into excessive detail — if detail is necessary set it out logically. You should write to us with the following information. •

your full name and address and other contact particulars (e-mail address, telephone number) and details of your connection with the charity or the community gaming activity (if any)

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the name of the charity and its CFN registration number (if known)

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the name of the organiser of the community gaming activity and its permit number (if any, if known)

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a summary of your complaint or concern, and the background to what has occurred

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relevant dates and times

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description of incidents

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details of conversations and meetings

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copies of relevant letters

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any explanations you think are important

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any documentary evidence (or copies) in support of your complaint

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details of any attempts you have made to have someone in authority in the charity or the organisation of the community gaming activity to put right what you believe to be misconduct or wrong

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details of any previous correspondence or

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details of any complaints made to the police or other public bodies about these matters.

Indicate what action you think we should take to resolve the problem. It is a criminal offence knowingly or recklessly to supply us with information which is false or misleading. Anyone able to give information in good faith, however, should feel quite free to do so.

Confidentiality We do not normally take any action on the basis of anonymous information. It will be difficult for us to act unless we can use the information provided. If you write to us, please state: •

whether we may put your complaint and any evidence to the charity or the organiser of the community gaming activity, and

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whether we may reveal your name to the charity or the organiser of the community gaming activity as the complainant.

If you do not wish this to happen, you may nevertheless pass information to us. Also, please mark your complaint with words (eg. confidential or in confidence) that would make your intention clear to us. Nevertheless, we have a policy that prohibits officers divulging information about complainants, etc., to other persons. You may be assured that in the absence of any clear direction from you, your name and particulars will not be divulged. We will respect confidences so far as we are able, but any person criticised by us as a result of an inquiry has a right to be told the nature of the evidence upon which the complaint has been based, and in some cases this evidence may point towards the complainant. The results of inquiries may also be used in Court proceedings, and some, of particular public interest, may be published. Documents and information gathered during the course of an inquiry will be treated in confidence, unless and until we decide to publish the results (if necessary) or they are required under a Court Order during legal proceedings. The Freedom of Information Act 1989 (FOI Act) confers on each member of the public a legally enforceable right to be given access to documents held by Government subject only to such restrictions as are reasonably necessary for the proper administration of Government. The Act requires any discretion conferred to be exercised

INVESTIGATING CHARITIES additional information from the charity or the organiser of the community gaming activity.

The grounds of exemption include Clause 13 of Schedule 1—documents containing confidential information. Clause 13 of Schedule 1 states that a document is an exempt document:

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it is a matter which we can properly investigate, and

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the matter is sufficiently serious to justify an investigation.

(a) if it contains matter the disclosure of which would found an action for breach of confidence; or

As we must give priority to the most serious cases of abuse or bad administration, we may not be able to investigate some minor complaints if our investigation staff is engaged on higher priority work, or if the costs of an investigation far outweigh any loss to the charity or the community.

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as far as possible to facilitate and encourage the disclosure of information. Each document is to be examined on the premise that access is to be given unless an exemption provision specifically provides for the exemption of the information contained. The exemption provisions are to be narrowly and strictly interpreted.

(b) if it contains matter the disclosure of which (i) would otherwise disclose information obtained in confidence; and (ii) could reasonably be expected to prejudice the future supply of such information to the government or agency; and (iii) would, on balance, be contrary to the public interest.

To find an action for breach of confidence it is necessary to show that the information is inherently confidential, the document or the information contained in the document was given in circumstances which indicate the establishment or existence of a confidential relationship and that there is unauthorised use of the information to the detriment of the informant. The existence of a confidential relationship may be expressly stated or inferred from all the circumstances. This clause of the FOI Act is concerned with protecting information that would not have been given to us unless confidentiality was maintained. If you mark your letter of complaint with words to the effect that it is submitted IN CONFIDENCE, we would submit that this requirement is met and access would be refused. However, section 25 (4) of the FOI Act provides that if it is practicable to provide access to a document from which exempt matter has been deleted, and it appears that the applicant would wish to have access to such a copy, there is a duty to provide access accordingly. This possibility must be examined in every case before a decision is made to deny access to any page of a document.

What happens when we are alerted? Compliance Officers in our Investigation Unit will examine your complaint and the information you provide, together with any other information on our files about the charity or the community gaming activity. They may also need to obtain

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Each complaint is reviewed and assessed against criteria to determine its priority. The Investigation Unit will evaluate the information to decide whether:

You will be advised as soon as possible, normally within two months, whether we propose to take action.

Investigations / Inquiries Compliance officers of the Investigation Unit carry out investigations or inquiries. They have the skills and experience to investigate. In some rare cases, specialists from outside the NSW Office of Liquor, Gaming and Racing may also help carry out this work. Compliance Officers are under a duty to act fairly. They are concerned solely with the best interests of the charity and its beneficiaries. They do not represent the interests of either the complainant or the management committee of the charity or the organiser of the community gaming activity. They have power to obtain and copy all relevant information and documents from the charity or the organiser of the community gaming activity, advisers and bankers of the charity or the community gaming activity, which are necessary for their work. When we investigate our main concern is to ensure that the charity or the organiser of the community gaming activity suffers no financial loss or damage to its reputation as a result of anyone’s misconduct. We also need to ensure that the charity or a community gaming activity will be managed properly in the future.

What action can we take to put matters right? We can take action in many ways, if an inquiry finds misconduct or mismanagement. For example, we can:

INVESTIGATING CHARITIES prohibit further fundraising or community gaming activities

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stop further actions by the charity’s management committee in dealing with the charity’s property (which includes land, buildings, investments and cash)

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appoint an administrator to conduct the affairs and activities of a charity

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refer the matter to the appropriate authorities for them to consider legal proceedings

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refer the matter to the police or to other government agencies for appropriate action

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refer issues concerning trustees to the Attorney General’s Department for consideration of matters under the Charitable Trusts Act 1993 (suspend or remove trustees and employees, appointment of new trustees, etc.).

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In less serious cases, we may simply give a charity or the organiser of a community gaming activity a warning and ensure that faults are put right. If necessary, we will monitor future activities. We aim to help charities and the organisers of community gaming activities achieve what they want to do, within their charitable purposes (if any) and the requirements of the law. We will try to let you know the outcome of the investigation, though some are very complex and can take many months, sometimes more than a year, to complete.