8 February 2011

The Charity Commission, the independent regulator for charities in England and Wales, has today published a report on its investigation into the Children's Air Ambulance, (registered charity number 1111780).

The charity was registered with the Commission in late 2005 with the object of providing a specialised air ambulance service for children and babies in the UK.

The Commission's investigation was opened after a significant number of complaints were received from members of the public about the charity, and in particular about its fundraising activities. Several of the complainants also made reference to misleading literature alleged to have been produced by the charity that indicated it was operating an air ambulance service when it was not. Some complainants also raised concerns that the charity's accounts appeared to reveal a high percentage of income had been paid out in consultancy fees.

The investigation was opened to examine all of these issues. It also looked into the charity's relationship with a company connected to its founder and how this conflict of interest was managed, as well as the charity's accounting practices and the general administration, governance and management of the charity by its trustees.

The investigation established that the charity does not own, lease or provide an air ambulance service. Some of the charity's literature was found to be misleading on this point so the investigation advised the trustees to amend their literature and the charity did this immediately. However, the investigation took the view that the trustees had taken active steps towards establishing an air ambulance service in the future and had put measures in place to strengthen their governance to help them achieve their goals and mitigate against the risks of failure.

The investigation found that in the charity's first year of operation the trustees had not taken steps to manage the conflicts of interest created by the payment of nearly all of the charity's income to its founder for his work in trying to establish an air ambulance. The Commission provided advice on this and the charity has now carried out governance training and adopted new policies to ensure that any conflicts that may emerge in the future are appropriately managed.

The Commission provided further advice on fundraising methods and the trustees have now taken steps to improve the charity's practice in this area. They have also improved the administration, governance and management of the charity and, having received regulatory advice and guidance from the Commission, have been made aware of their responsibilities in managing the charity in the future and are therefore in a better position for the charity to achieve its objects.

The Commission will monitor the charity to ensure that it continues to make progress to establish an air ambulance service and operates in accordance with fundraising best practice.

The full regulatory case report is available on the Charity Commission's website – www.charitycommission.gov.uk. For further information, please contact the press office.

PR 06/11

Notes to Editors

1. The Charity Commission is the independent regulator of charities in England and Wales. See www.charitycommission.gov.uk for further information or call our contact centre on 0845 300 0218.

2. Our mission is: to ensure charities' legal compliance, enhance charities' accountability, encourage charities' effectiveness and impact and to promote the public interest in charity.

3. The Commission conducts two kinds of investigation cases. Most concerns are dealt with through non-statutory investigations called ‘regulatory compliance cases'. However, in cases of significant risk and more serious regulatory concern we may open a statutory inquiry under section 8 of the Charities Act 1993. The decision to open a statutory inquiry will be based on a number of factors, including evidence of serious suspicion of misconduct or mismanagement in the administration of the charity and/or risk to property. The criteria we use are set out in our Risk and Proportionality Framework for the Commission's compliance work.

4. More information about the Charity Commission's Compliance Division can be found in Charities Back on Track, a report on the themes and wider issues arising from the Commission's compliance work. This can be found on the Commission's website.