Charity Commission releases report on the SPCK/SSG Bookshops

IT’S TAKEN A LONG, LONG TIME but today the Charity Commission has at last issued its assessment of the Brewer brothers’ gross mishandling of the former SPCK Bookshops.

The nine page report (available here) fails to identify the Brewers by name but nonetheless makes damning reading as it brings to light huge irregularities in a wide-ranging and complex inquiry that examined four specific areas:

• Conflict of interest/loyalty, trustee benefit and self-dealing
• Exposure to financial liability of the company and the trust
• Bankruptcy proceedings in the United States of America
• Potential damage to public trust and confidence

After a brief introduction to the Saint Stephen the Great Trust and Company, the report  identifies the issues under investigation, summarises the Commission’s findings, reviews the interim manager’s activities and findings, and draws the following conclusions:

The interim manager concluded that the trustees had mismanaged the trust. There were unmanaged conflicts of interest and loyalty related to directorships of associated companies and contracts entered into by some of the trustees.

The inquiry considered that some conflicts were so intrinsically linked to the trust’s administration that they could not be managed. The inquiry was concerned that the trustees’ lack of ability to manage conflicts of interest and loyalty arising from their involvement in connected organisations could lead them to consider it appropriate to use the trust’s funds to satisfy the liabilities of the other entities.

The inquiry highlighted poor governance, lack of due diligence and inadequate record keeping on the part of the trust trustees and the company directors. Trustees are under a duty to be prudent with the charity’s assets, the lack of prudence in this case and the lack of trustee awareness of their responsibilities has led to the demise of the trust and the company.

The interim manager concluded that it would be expensive and risky for the trust to restart managing the shops. There was no prospect of new trustees wishing to manage the trust and no evidence that beneficiaries or interested parties wished the trust to continue. It was in the trust’s best interest for it to be wound up with surplus assets transferred to charities with similar objectives.

The inquiry concluded that there had been serious mismanagement and misconduct of the trust and company by the trustees.

It then goes on to outline the extent, cost and impact of the Commission’s regulatory action, briefly noting the vast sums involved:

Trust assets of £3,226,100 were safeguarded by the appointment of the interim manager and claims of £4,171,710 were managed. £1,928,853 was disbursed in settlement of claims and £144,486 was disbursed to Orthodox communities.

Finally, the report considers issues for the wider sector, highlighting lessons to be learned from the failings noted and highlighting the duties and responsibilities of charity trustees, who must always:

• act only in the best interests of the charity
• actively manage actual or potential conflicts of interest
• familiarise themselves with the appropriate legal requirements and take professional advice
• keep proper accounting records and an adequate audit trail

Sadly, as well as failing to name those responsible for this Christian book trade disaster, the report also fails to consider the human cost for those caught up in it — the distress, hardship and misery caused to so many — noting only that “Thirty four of the shops’ ex-employees submitted redundancy claims” and that “Settlement of the redundancy claims from ex-shop employees was made and claims were paid in 2009 and 2010.”

Durham Cathedral Staff Tribunal Starts

Our thanks to Valiant For Truth for bringing to our attention that in The Journal Newspaper yesterday there was an article of great import to those who frequent this site,

Durham Cathedral Bookshop Staff Launch Legal Fight

This in many ways marks the official start of Durham Staff in their fight for Justice against the Brewer Brothers and their tactics of playing fast and loose with employment law and the rights of workers to be treated fairly and dismissed in a right way.

However Durham Cathedral itself via their trading arm are also in the dock as it were, again something that may not come as any great surprise to readers of this blog who have at times been dismayed, upset and hurt by some of the Cathedrals inactions and actions throughout the saga.

The article begins by saying:

CATHEDRAL bosses could become embroiled in a complex legal fight after bookshop staff launched tribunal proceedings.

Six workers at Durham Cathedral’s bookshop are seeking compensation after their employment was allegedly terminated when the shop unexpectedly closed on January 22 this year.

But confusion has arisen over who is potentially liable for any payouts and proceedings have been listed against several different companies, including the cathedral’s trading arm, Durham Cathedral Trading Ltd.

The article then goes on to say:

Miss Jeram, representing the Trust, (inserted clarification for blog readers – that’s SSGCT) said: “There are a number of uncertainties. There has been a great deal of confusion right from the beginning over their employer.

“The only issues can be who the employer was immediately prior to the closing of the bookshop and who the employer was at any time after that, in the period between January 22 and March 1.

“We’ve got to consider whether the claims should be struck out against the first respondent. At some point after June 2007 and before July 2008 it is my understanding that the Brewers attempted to wind up SSG LLC in Houston. After that time their employer could not have been SSG so it would have become the Durham Cathedral Shop Management Company.”

Claims against employers involve redundancy pay, unfair dismissal, breach of contract and unpaid work.

Sara Brody, representing the staff on behalf of shop workers union Usdaw at the hearing, argued the Trust should remain on the list of potential employers.

She said: “The claimants believe the Trust was their employer throughout, so their primary claim is against the Trust.”

Last year Durham cathedral bosses served SSG notice to vacate the shop, the last in the UK to be involved with the Trust, by May of this year.

Again these issues as raised are nothing new to anyone aquainted with this situation, previous tribunal actions and this blog.

So again we would ask that anyone who has any information, paperwork or correspondence of any sort that could help USDAW and the Durham staff to clear up the issue of employers please do get in touch with them directly.  Anything that demonstrates who people believed they were doing business with or indeed were doing business with during the time frames mentioned can all help in proving who the employers were and give credence to the staffs perception of employer, so please do get in touch with USDAW and offer your help to them in making sure justice is again done.

As always our thoughts are with those involved in this action and we hope for a swift and just outcome for the Staff at Durham.

SSG to Remain under Charity Commission Control

Phil Groom writes:

Thanks to ‘Mole Island’ for the pointer to the Charity Commission’s Case Summary for their investigation into the St Stephen the Great Charitable Trust, report issued 8th March 2010, published 12th March 2010 [1]:

Saint Stephen the Great Charitable Trust (1109008, formerly 1119839-1)

1. In April 2009 a number of Orders were made by the Charity Commission in relation to this charity under s.18(1) of the Charities Act 1993:

i. to vest the charity’s interests in land in the Official Custodian for Charities; and

ii. to appoint an Interim Manager to the charity, with specific functions to address immediate and serious difficulties which it faced.

2. The Commission was asked to review its decisions to make (and subsequent decisions not to discharge) these Orders.

3. The review, which was conducted by Board Members John Wood and Simon Jones acting under the delegated authority of the Board, considered the evidence and the reasoning behind the original decisions, as well as representations made on behalf of the applicant.

4. The Board Members decided on 3 February 2010 that the Orders are upheld (unvaried) because it remained necessary or desirable for them to remain in place for the purposes of protecting or securing the proper application of the property of the charity.

5. The applicant has been advised of the decision, the full reasons for it and the right for persons with standing to bring an appeal against the decision to the First-tier Tribunal (Charity).

© 2010 Crown Copyright

Third Sector, the charities and voluntary services news site, have reported the story here: Christian charity to remain under crisis management, h/t Eddie Arthur.

Meanwhile a report in this month’s Christian Marketplace (Industry News, p.6, ‘SSG Tribunal claims completed’, online edition available here) notes that all outstanding payments (total £301,500) to former SPCK/SSG bookshop employees who were Usdaw members have now been made. Sadly, however, as the report concludes, whilst this is good news for the 32 Usdaw members, “there are many others who have received no compensation and still carry the scars of their experience in one of the most unhappy events in the history of Christian retailing in the UK.”

[1] Dates given at Final Decisions of the Commission – Alphabetical Index

Concerns about call for SPCK/SSG Creditors

Matt Wardman writes:

Following on from our previous posting about the call for creditors of the Saint Stehen the Great Charitable Trust to come forward within the next 2 weeks, only if they know that they are owed money from before July 2007, we have written to relevant magazines raising these concerns:

• The complexity of the history of this whole affair, and the deliberate obfuscation introducd by the Messrs Brewer,  makes it very difficult for potential creditors to know whether they come within the restrictions laid down, or not.
• As far as we are aware, the notice has only been published in The Bookseller, while the SPCK chain was a business with worldwide links – far beyond the book trade.
• How can such a range of creditors can be realistically expected to respond to a notice with a 3 week deadline in a booktrade magazine, posted up to 3 years after the relevant debts were incurred?
• Does this adequately meet legal requirements for informing creditors?

We are not publishing the full text of the letters here until after they have been published in the magazines and newspapers concerned, for obvious reasons.

We have not raised several further points, because we are not sure ourselves what difference they make, and would make our letters even longer than they are already:

Interim Manager's Notice

1. The Interim Manager is in control of the two charities “Saint Stephen the Great”(1119839), and “Saint Stephen the Great Charitable Trust” (1119839-1).
2. The Charity Commission website states that he controls the former, and he has himself declared himself to be in control of the latter when claiming possession of shops.
3. These charities were forcibly merged by the Charity Commission around 23 July 2007.

So what is the basis for taking responsibility for actions of one charity only? Shouldn’t creditors of both of these charities be able to seek redress for debts incurred over a far greater period of time?

In any case:

• Given the complexity, and lack of clarity, in this history, all creditors, and potential creditors, should get in touch with the Interim Manager using the contact details in the notice, and/or those given on the Charity Commission site; these are stsgct@gothamerskine.co.uk via email, or by phone on 020 7490 1880.
• We hope that specific contact will be made with the hundreds of suppliers identified in the Court Documents, who are potential creditors even within the period before July 2007.
• We also hope that the deadline for responses will be extended to a more realistic period, perhaps to the end of January 2010.

There may be more, as and when we have (or understand) it.

Chichester: The Door is Shut. Only Durham remains.

Matt Wardman writes:

These are two photos cross-posted from the ASingleBlog site. The former-SPCK Bookshop in Chichester has been closed on the instructions of the Charity Commission.

This is sad, and yet it means that – exactly as per the takeover of the SPCK-SSG charity by the Charity Commission Interim Manager – those trying to resolve this are now dealing with people of integrity, so we can at least say that Chichester is now on the way out of the swamp.

So the Brewer cash-generating, personal-expenditure subsidising, money-grubbing, supplier-swindling, staff-bullying, legality-avoiding (e.g., lack of required liability insurance), asset-stripping, and Durham Cathedral brand-poisoning, activities can now only be carried on in the Durham Cathedral Bookshop.

Every day that the Brewer-boys retain control of that shop provides a further opportunity for abuse.

Will someone in authority please finish the job?

Here are the Chichester Photos:

Taking Stock in Chichester

Phil Groom writes:

I have been informed that the Charity Commission are now closing in on the Chichester shop. Anyone in Chichester, please keep your eyes peeled and cameras ready to record any suspicious activity…

A message to all our supporters

David Keen writes

the following was sent to the 475-odd members of the We Support Dave Walker Facebook group earlier this week:

Subject: 1 year on

Dear all,

This Wednesday, 22nd July, was 1 year to the day since Dave Walker and Phil Groom both recieved their ‘Cease and Desist’ legal threats from Mark Brewer. An awful lot has happened during that time, not least of which has been the support of hundreds of you for Dave, former SPCK bookshop staff, and others who have suffered at the hands of the Brewers.

The good news is that plenty has been achieved.
– Firstly, Mark Brewer failed to get his St. Stephen the Great charity declared bankrupt in the US, a court case in which Dave’s posts were cited as evidence.
– In April this year the UK Charity Commissioners took over the running of the St. Stephen the Great charity, after a formal investigation.
– Even though the Brewers had moved all the bookshops into a new organisation (ENC Shop Management) the CC’s are now taking possession of these shops as St. Stephen assets.
– 30 former staff, whose tribunal against SSG was being heard earlier this year, will now have their cases settled by the Charity Commissioners.
– In the meantime Durham Cathedral has (at last) served notice on the Brewers tenancy of the Cathedral shop.

As you may know, though the SPCK posts remain absent from the Cartoon Blog (see them in full at http://opendebatenotlibelthreats.blogspot.com/), Dave has mentioned the saga a couple of times on his Church Times blog. At no point have any of Mark Brewers threats been acted upon. Instead it’s Mr Brewer himself who has gone very quiet.

Thankyou again for your support of Dave, and for those of you who have blogged, commented and emailed in support. We may be at the beginning of the end – both the end of SSG’s dismal foray into UK bookselling, and the end of the bookshop chain themselves. Any further developments will be reported at https://spckssg.wordpress.com/

Your fellow supporter

Changing the Locks: Official Notices as seen in Chester, Newcastle-upon-Tyne and Worcester

Phil Groom writes:

• Updated July 11, 2009

Thanks to our intrepid photographers in Chester, Newcastle-upon-Tyne and Worcester for these snapshots of the official ‘Changing the Locks’ notices (see previous post). Transcripts below the photos.

1. Chester

The locks on this property have been changed...

Notice:
The locks on this property have been changed under the authority of the Interim Manager of Saint Stephen the Great Charitable Trust (1119839-1) who was appointed by Order of the Charity Commission for England and Wales, made under S. 18(1)(VII) of the Charities Act 1993 as amended by the Charities Act 2006, on 28 April 2009.

If access is required to the premises please contact Fergus Jack at DTZ on 0207 643 6579

Fergus Jack

DTZ
48 Warwick Street, London W1B 5NL
Tel: +44 (0)20 3296 4494

2. Newcastle-upon-Tyne

… and thanks to yet another intrepid photographer in Newcastle-upon-Tyne. Again, transcript below the picture.

Newcastle-upon-Tyne - Keep Out, by Order of the Interim Manager

NOTICE

St Stephen the Great Charitable Trust
(Registered no 1119839-1)

8 Ridley Place, Newcastle upon Tyne, NE1 8JW

Take notice that I, Peter Gotham, was appointed Interim Manager of the Business and Assets of St Stephen the Great Charitable Trust by the Charity Commission under case no. 685451 on 28 April 2009.

No entry to this building is permitted without my express authority.

Any enquiries regarding access should be addressed during office hours to:

Fergus Jack

Telephone: 0207 643 6579

P Gotham
Interim Manager
St Stephen the Great Charitable Trust

… and if anyone’s wondering, there is still some stock in the Newcastle shop:

Newcastle Shop, July 2009

3. Worcester

Courtesy of Doug Chaplin, aka Clayboy:

Worcester - No entry to this building is permitted...

NOTICE

St Stephen the Great Charitable Trust
(Registered no 1119839-1)

105 High Street, Worcester, WR1 2HS

Take notice that I, Peter Gotham, was appointed Interim Manager of the Business and Assets of St Stephen the Great Charitable Trust by the Charity Commission under case no. 685451 on 28 April 2009.

No entry to this building is permitted without my express authority.

Any enquiries regarding access should be addressed during office hours to:

Fergus Jack

Telephone: 0207 643 6579

P Gotham
Interim Manager
St Stephen the Great Charitable Trust

Changing the Locks?

David Keen writes:

On the grapevine yesterday….

“I have just been told that this morning the locks on the door of Newcastle shop have been changed, and a notice has been placed on the door by the Interim Managers re the Charity Commission investigation.”

Can anyone else confirm this? Is there any news from the other shops?

It would make sense, with the Charity Commissioners taking control of St. Stephen the Great assets. If true, it may also show that, as far as the CC is concerned, the change of name last year to ENC Management was a smoke and mirrors exercise designed to get SSG out of its financial obligations.

There is possibly another SSG asset parked near Durham Cathedral, so if you see this go up for auction in the name of the Charity Commissioners, please give generously.

Meanwhile if you see anyone fiddling with the locks on a former SPCK shop, please ask what they’re doing. If they represent the Charity Commissioners, then bless them loudly. If they try to disguise a Texan accent and have a van with the engine running parked outside, then be suspicious.

Is this the ‘Best Use of New Media in a Christian Campaign’?

David Keen writes:

The ‘Bloggies’ – Christian Web and New Media awards – are now open for nominations. I’ve taken the liberty of nominating this blog for ‘Best Use of New Media in a Christian Campaign’.

Phil’s blog is very much the hub of the SPCK campaign, but there’s much more going on. Many of us who are involved have never met face to face, but through blogs, email, Facebook, online petitions, Google Groups, and even Twitter we’ve built a network of supporters from several countries, and in the last 2 weeks there has been a mini-avalanche of remarkable results from the pressure that the campaign has brought to bear:

• Durham Cathedral have served notice on the Brewers to leave the premises
• The Charity Commissioners have taken control of the assets of the Society of St. Stephen the Great.
• Following the CC action, an out of court settlement with unfairly dismissed staff may now be possible
• and Dave Walker is back to blogging about the SPCK story. Mark Brewers initial ICBM (inter-continental bullying manoevre) seems to have backfired spectacularly in the intervening 10 months. Welcome back Dave.

I have a slight quibble about the Bloggies, in that anyone using new media effectively will, hopefully, be using more than one website to do it. The online SPCK campaign – which effectively began as Dave Walker’s ‘Save the SPCK’ campaign on The Cartoon Blog – has diversified into several ‘new media’ as it has evolved. Any campaign simply using one platform probably shouldn’t get past first base!

If you’d like to nominate the SPCK/SSG campaign too, please do! Here’s what I put in the ‘additional information’ box:

A campaign to scrutinise and hold to account the new owners of SPCK bookshops, which recently resulted in decisive action by both the Charity Commissioners and Durham Cathedral. The campaign provides a discussion space, as well as a focus for scrutiny and lobbying.      

Use of new media includes

– Several blogs, of which the named blog is the key one. With the censorship of Dave Walkers blog, it’s been important to have several blogs reporting the story, so that ‘divide and rule’ through legal threats won’t work.  The reposting on over 70 blogs of material which the new SPCK owners attempted to censor was vital both in building a public profile, and in demonstrating support for those victimised by the new owners.
– Online petitions
– Facebook: there are two related groups on Facebook, which give the campaign an online mailing list of around 600 people, as well as a forum for spreading information.
– Google groups, as a forum for the leaders of the campaign to communicate and share information.
– more recently, Twitter.

Many of those involved in the campaign haven’t met face to face, but new media has enabled us to network, co-ordinate our efforts, and spread information to a wide group of people.

David Keen blogs at St. Aidan to Abbey Manor, and has just joined the team on SPCK/SSG News, Notes and Info.