By Gordon Deegan
The cost to scandal-hit charity, Bóthar, of identified alleged fraud and related legal and other costs now totals €1.2 million.
That is according to figures contained in new accounts filed by the Limerick-based charity which states that the cost of the identified alleged fraud and connected legal costs totals €490,878 for the 12 months to the end of June 2021.
This follows a combined bill of €713,058 over the prior three-year period.
In their report, the directors state that the the matters relating to the alleged fraud “have damaged the reputation of the charity in the eyes of the public at large and damaged trust for loyal supporters and partners”.
Charity
The alleged fraud first came to public attention through High Court proceedings brought by Bóthar in 2021.
The new accounts show that the charity’s income from donations plummeted by 41.6% from €2.83 million to €1.65 million in the 12 months to the end of June 2021.
The estimated cost of the identified alleged fraud for 2021 totals €28,025 which brings to a total of €393,583 over four years.
The estimated cost of alleged fraud in 2020 was €52,354, €187,768 in 2019 and €125,436 in 2018.
The directors caution that these amounts do not reflect the full extent of what they believe to be the value of the alleged fraud.
The newly filed accounts, approved by directors on Monday (July 3), show that there have been “substantial costs” to the charity in pursuing matters connected to the alleged fraud.
The directors state that “with the viability of the charity at stake the board have taken measures to ensure that robust financial controls and good governance are in place across the organisation”.
“The organisation has streamlined various expenditures, including payroll costs, overhead and running costs and the disposal of a former office premises in Dublin. We have also ensured to claim our tax back income.
“Our intention is to recommence active fundraising once we have published our accounts and communicated clearly with stakeholders.”
The board state that they had projected certain income through 2023 and in the first six months of this year the projected level has been on target.
The board state that they are confident in Bóthar’s ability to maintain and grow income levels.
The bulk of the €1.2 million bill to the charity from the alleged fraud concerns connected ‘legal and other costs’.
Bóthar
Bóthar’s activities include aiding poor farmers in developing nations through donations of livestock.
The accounts show that in his report, independent auditor, Damian Gleeson of Grant Thornton has provided a ‘disclaimer of opinion’ on the financial statements.
Gleeson explains “we have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements”.
He states that “despite full cooperation from the current board members and the new CEO, it has not been possible to furnish us with all the information and explanations, which we consider necessary for the purposes of our audit”.
“There are ongoing investigations into the various activities by the former CEOs over a substantial number of years,” he said.
Gleeson noted that “the actions of the former CEOs remain the subject of both criminal (Garda) investigation and civil litigation whereby the outcomes of these investigations are not known at this point”.
The Charity Regulatory Authority (CRA) has also commenced a separate investigation into these matters and the ultimate outcome of these matters cannot presently be determined.
Gleeson also states that a note in the Bóthar financial statements indicates “the existence of a material uncertainty which may cast significant doubt on the company’s ability to continue as a going concern”.
The alleged misappropriation of funds at Bóthar first came to public attention in 2021 through the charity taking High Court injunction proceedings against its former chief executive, David Moloney.
The alleged irregularities first came to light during the 2019 financial year from an anonymous whistleblower concerning inappropriate travel expenses.
In the High Court, David Moloney, who resigned as chief executive in February 2021, said he and the former chief executive, the late Peter Ireton, misappropriated hundreds of thousands of euro in cash
Ireton, one of the founders of Bóthar died in his home in April 2021. He had denied any impropriety.
The charity recorded an operating loss of €17,378 in 2021 after its overall income slumped by €1.2 million or 37% to €2.17 million. Its spend in 2021 declined by €1.4 million (-39%) to €2.19 million.
At the end of June 2021, the charity’s total funds amounted to €1.38 million, while its cash funds totalling €723,703.