Charity Commission rules on ‘conflict of interest’ between councillor’s charity and business

Former Speaker of Hackney Cllr Michael Desmond

The Charity Commission has published its report into an alleged conflict of interest between a homelessness charity founded by a Hackney councillor and an estate agents he owns.

House the Homeless, which provides support and advice to homeless people, was founded by former Hackney Speaker Cllr Michael Desmond.

The commission took “regulatory interest” in the charity after complaints were received alleging that homeless clients of the charity were being referred to an estate agent owned by Cllr Desmond.

Earlier this year, Cllr Desmond said he suspected that the ‘nimbyism’ of some residents who might not wish formerly homeless people to move in alongside them might be behind the complaints.

However the report found that Cllr Desmond was the landlord of a beneficiary referred from the charity, if only “as a short-term measure”.

Rent charged to the beneficiary was “less than could be achieved through private rental” and the agency “did not charge fees to clients for referrals from the charity”, the report said.

The commission also found that the charity was being operated from premises owned by the Cllr Desmond, which were also partly used by the estate agency he owns. The charity was not charged rent but service charges were shared with the estate agency.

An employee at the On the House estate agency, who was also a trustee of the charity, staffed the charity’s dedicated phone helpline.

The report said that some trustees “appeared to have little experience of running a charity or knowledge of charity law” and that they had not “fully appreciated the conflict of interest in relation to the founder’s previous involvement with the charity.”

Cllr Michael Desmond said the findings of the Charity Commission’s report were “innocuous enough”.

He told the Hackney Citizen: “The report seems innocuous enough, although trustees need to take cognisance of it. I was never a trustee and stepped down as co-ordinator six months ago, the charity found alternative accommodation to avoid any possible perception of a conflict of interest.

“There had been total transparency and no complaints from any homeless people we helped; I remain a volunteer.

“Whilst Speaker I helped to raise almost £29,000 for other charities.”

As a result of the assessment, the charity has now moved to a new office and has its own phone line manned by volunteers.