The Oxfam scandal has seriously damaged the reputation of Oxfam after it emerged that some of its employees used charity money to pay for prostitutes in Haiti following the earthquake in 2010. Furthermore, it is alleged that claims of the misconduct were covered up by Oxfam.
Oxfam denies that the scandal was covered up and launched an internal investigation in 2011 which it announced publicly. The Charity Commission, however, claims that it was not given full details of the misconduct at the time and Oxfam is currently being investigated by the Charity Commission.
The Charity Commission has claimed that if it had received full details of the misconduct, it would have taken another approach to its investigation. More importantly, if another approach had been taken, then Oxfam's director of operations, Mr Van Hauwemeiren, who has been accused of sexual misconduct, may have been prevented from going on to work at another charity. Oxfam has subsequently been accused of covering up the misconduct and for failing to warn other aid organisation's about the allegations.
Implications of misconduct
The Charity Commission has launched a statutory inquiry into Oxfam as it has stated that "Oxfam may not have fully and frankly disclosed material details about the allegations at the time in 2011". The statutory inquiry will inspect how the charity is run with scrutiny over its management practices as well as its "policies and practices with regard to safeguarding". Moreover, the inquiry will consider how the charity has responded since 2011 as well as assessing its requirement to provided safety and security for its charity workers, volunteers, beneficiaries and employees.
A further objective of the inquiry is to examine Oxfam's progress in applying an agreed Charity Commission action plan in 2017. Ultimately, the aim of the inquiry is attempt to re-establish the trust and confidence of the public in the charity. Details of the report will be published.
Loss of Reputation and Loss of donations
Oxfam's scandal has seriously damaged its reputation. Celebrity activist and ambassador for Oxfam, Minnie Driver has subsequently stepped down from the role after having supported the charity for a number of years.
Similarly, it has been agreed that Oxfam will not bid for further UK government funding until it has re-established its reputation and meets the standards of a reputable charity.
As a consequence of the Oxfam's loss of reputation, it has been reported that thousands of regular donations to the charity have stopped along with the cancellation of direct debits. Ultimately, the shock and level of misconduct means that members of the public may be less likely to donate to the charity having lost confidence in the organisation. Moreover, it has been reported that the public are reluctant to donate to other major charities following the scandal.
Charities will be interested in the outcome of the Charity Commission's inquiry and will also look to review their own safeguarding policies and procedures. Charities will also be reminded of the duty to make full and frank disclosure of serious incidents to the Charity Commission. Trustees have a legal duty to preserve their charities' reputation and serious damage to a charity's reputation can impact upon its funding and ability to deliver its aims through loss of public trust and confidence. We can provide advice and training on safeguarding issues.
This article is for general guidance only. It provides useful information in a concise form. Action should not be taken without obtaining specific legal advice.