178:, Moonbeams' trading company was obliged to transfer almost all its profits to the Moonbeams charity, so that it could be spent on charitable objectives. But the SCO stated in their petition to court that, of the £185,461 net profit raised by the trading company over four years of operation, £101,006 had remained in the trading company's accounts. This is the origin of the often-quoted figure of around £70,000 which finally made its way to the charity.
45:, which became the subject of a much-publicised local controversy in 2003. Following court action, it emerged that the charity had income of nearly £3 million over a period of four years, but had spent little over £70,000 on its charitable objectives. The Moonbeams collapse was one of a series of incidents which ultimately led to extensive reform of charity regulation in Scotland.
162:, Willie Power, the founder of Moonbeams, responded: "Obviously, a mistake has been made somewhere, but it has been an unintentional and honest mistake. We are a group of people whose lives have been touched by cancer and want to help in some way. We are not business professionals." Subsequently quoted in
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Willie Power, the founder of
Moonbeams, was criticized by local media for demanding £3,000 in salary to cover the period immediately prior to the charity's collapse. However, the court-appointed administrator pointed out that he was simply claiming the same rights as any employee. Power had earlier
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The reason for this was that the lawyers, Lindsays, recommended setting up the trading arm to absorb all the costs of the charity, including the salaries of all employees. This meant that 100% of any donations made to the charity would go to the charity and it could be advertised as such. The trading
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to consider the law relating to
Scottish charities. The commission's report recommended the establishment of a new regulator for charities in Scotland and the creation of a register of Scottish charities. Although this report was published in June 2001, it is widely thought that the events of 2003
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appointed by the court, said: "There’s nothing we have come across yet that would indicate there’s anything criminal. We have high administration costs, a lot of travel costs and credit card costs." Moonbeams did indeed sign up for some bad deals but in the opinion of those who worked there, it was
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The petition also revealed that
Moonbeams' performance had deteriorated sharply as the trading company's operations expanded. Between July 1998 and March 1999 the company had a turnover of a little less than £100,000, and made a profit of around £40,000. But in the following year to March 2000,
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The SCO's petition also stated that, on a single occasion, Katherine Power - the daughter of the charity's founder - had been allowed to use the charity's house in
Florida. The SCO argued that this was contrary to the objects of the charity, as it deprived a family of a child with cancer of the
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In lodging the petition, the SCO made a number of allegations concerning the running of the
Moonbeams charity and trading company. As the directors of the charity did not answer the petition by the court deadline, their responses to these allegations can be surmised only from a small number of
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The
Moonbeams charity was founded in 1992 by former postal worker Willie Power, two years after the death from cancer of his 11-year-old daughter, Gayle. The charity was well-known locally for raising funds by selling sweets, and was dedicated to helping children with cancer and their families.
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The SCO's petition further stated that one of
Moonbeams' former directors, Gary Easton, had acted as auditor for the charity while also a director, in breach of professional rules. Easton was not, however, a director of either the charity or the trading company at the time of the petition.
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In
November 2007, four years after the collapse of Moonbeams, Gary Easton made a voluntary agreement to repay an undisclosed portion of the £93,000 he had received from the charity in professional fees. The liquidators had argued that the original fees had been excessive.
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of £185,000. Although these figures might be reasonable for a normal commercial company, they were received with surprise by
Moonbeams supporters, who had purchased the goods in the expectation that a far greater proportion of the selling price would reach the charity.
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for
England and Wales. At the time there was no requirement for charities to submit annual accounts, or even to register unless they wished to claim tax benefits. Shortly after the Moonbeams directors were suspended, Professor Gordon McVie, former chief executive of
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in Edinburgh suspended the directors of the Moonbeams charity, appointing an accountant to run the charity's operations. The action was in response to a petition brought by the Scottish Charities Office (SCO), the precursor to the present
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Although there were some irregularities in the charity's affairs, there is no suggestion of substantial fraud. The charity's income was simply consumed by expenses, with little remaining to fund its objectives. Local newspaper
275:, the chair of the commission, Jean McFadden, said: "Our report seemed to disappear into a great black hole and nothing much happened. ... I think it would still be lying there had it not been for the breast cancer scandal."
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to donate its entire profit to the Moonbeams charity. This is a common and legitimate arrangement, which allows the charity effectively to trade commercially without breaking the rules associated with its charitable status.
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Responding to the allegation, Willie Power accepted that his daughter had used the house but argued that it would otherwise have been empty at the time. He also stated that travel costs had not been met by the charity.
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and at that time the regulator of charities in Scotland. It later emerged that the SCO had been investigating Moonbeams for around a year, based on concerns raised by their accounts.
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On 9 December 2003, the Court of Session made permanent the removal of the directors and trustees of Moonbeams. In April 2004, the court-appointed administrator began the process of
89:, with the aim of helping more children and their families to enjoy a short break away from home. By the time of Moonbeams' collapse it owned three holiday houses—two in the
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166:, he said: "I truly believe we did our best. There were no flash cars. I think the offices are quite nice but it's not all leather seats, it wasn't 'expense no object'."
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while turnover increased to over £550,000, the profit was less than £2,000; and in the year to March 2001 the profit was £2,250 on a turnover of nearly £1 million.
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had been similarly suspended by the Court of Session—again following the discovery that only a small fraction of its income had funded charitable objectives.
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The first complaint against Moonbeams concerned the performance of its trading company. Over four years of operation, the trading company had achieved a
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The Moonbeams incident was one of a series affecting Scottish charities in and around 2003. Most notably, earlier in 2003, the directors and trustees of
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By 1999, Moonbeams had given some 300 children holidays, days out, or a chance to meet a celebrity. In June 1999 it bought its first holiday home in
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259:, described Scotland as a "soft touch" and said "the reputation that Scotland has got is that there isn't yet a charity commission functioning".
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Much of the blame was laid on the weak Scottish regulatory framework, which was (and remains) entirely separate from the system overseen by the
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Although not referred to in the original petition, two queries concerning payments to directors arose after the court action.
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Appealing to charity : The Journal Magazine : The Journal of the Law Society of Scotland
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Children's charity raised £2.9m - but only £71,000 went to good causes - Scotsman.com News
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Attention naturally focussed on where the outstanding money had gone. Quoted in
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On 14 October 2003, as a result of a complaint from a competing charity, the
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CC35 - Trustees, trading and tax: How charities may lawfully trade Section D
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The matter was subsequently referred to Easton's professional body, the
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in June 2004, and received broad cross-party support. It received
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stated that his annual salary from the charity was just £25,000.
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This article is about the charity. For the Bill Evans album, see
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Tough controls on charities unveiled in bill - Scotsman.com News
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Investigators target 28,000 Scots charities - Scotsman.com News
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Demand for watchdog as charity shuts doors - Scotsman.com News
294:(OSCR), which had been established in December 2003 as an
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Courts to wind up scandal-hit charity - Scotsman.com News
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Failure to transfer funds from trading company to charity
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Charity boss denies £3m cash scandal - Scotsman.com News
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Former cancer organisations based in the United Kingdom
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Charity's auditor in accounts probe - Scotsman.com News
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In 1998, Moonbeams set up a parallel trading company—a
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Scandal charity director hits out - Scotsman.com News
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Moonbeams boss demands his £3,000 - Scotsman.com News
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BBC NEWS | Scotland | Cancer charity accounts frozen
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Year-long inquiry into Moonbeams - Scotsman.com News
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Moonbeams homes hope for charity - Scotsman.com News
302:. The OSCR took over key responsibilities from the
520:Official closure for Moonbeams - Scotsman.com News
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509:BBC NEWS | Scotland | Cancer charity 'wound up'
498:Charity boss pays back £50k - Scotsman.com News
271:prompted the Executive to act on it. Quoted in
205:Association of Certified Chartered Accountants
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139:arm, Moonbeams UK, would pay all the bills.
318:, another charity which collapsed in 2003
323:Office of the Scottish Charity Regulator
292:Office of the Scottish Charity Regulator
112:Office of the Scottish Charity Regulator
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290:on 14 July 2005. The Act co-opted the
262:By the time of the incidents, the then
662:Children's charities based in Scotland
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73:under United Kingdom law - which was
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379:Cancer kids get holiday home in York
122:Expenditure of the trading company
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687:Organizations established in 1992
316:Breast Cancer Research (Scotland)
245:Breast Cancer Research (Scotland)
118:interviews given to local media.
365:A good cause - Scotsman.com News
158:Reported in local newspaper the
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682:1992 establishments in Scotland
187:opportunity to use the house.
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672:Health charities in Scotland
667:Charities based in Edinburgh
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182:Use of property in Florida
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25:Moonbeam (disambiguation)
637:12 December 2007 at the
130:of £2.94 million, and a
692:Court of Session cases
160:Edinburgh Evening News
55:Strathclyde University
23:. For other uses, see
266:had already set up a
211:Payments to directors
657:Scandals in Scotland
300:Scottish Parliament
284:Scottish Parliament
152:forensic accountant
150:, Bill Cleghorn, a
273:Scotland on Sunday
264:Scottish Executive
257:Cancer Research UK
252:Charity Commission
164:Scotland on Sunday
148:Scotland on Sunday
51:Scotland on Sunday
239:Regulatory reform
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581:18 November
233:liquidating
227:Liquidation
93:and one in
651:Categories
329:References
268:commission
132:net profit
101:Suspension
75:covenanted
61:Foundation
21:Moon Beams
39:Edinburgh
31:Moonbeams
635:Archived
591:cite web
310:See also
195:Auditing
176:Covenant
128:turnover
43:Scotland
97:, USA.
95:Florida
87:England
35:cancer
575:(PDF)
568:(PDF)
597:link
583:2007
321:The
280:bill
83:York
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593:}}
589:{{
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278:A
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27:.
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