Charities Newsletter – January 2020

Our Charities team here at Blake Morgan publishes e-bulletins to keep you up-to-date with breaking news and topical issues affecting the sector.

Charity Commission: Serious Incidents Involving Partners

The Charity Commission has published new guidance for trustees on reporting serious incidents involving partners of the charity which will be relevant for any charities that work with partners and clarifies what action they may need to take where those partners have been involved in serious incidents.

Please see our blog piece on this for further information about this new guidance.

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Charity Commission alert: fraudsters impersonating staff

In December 2019 the Charity Commission issued an alert following several reports from charities who had been targeted by fraudsters impersonating staff via email, specifically attempting to change employees’ bank details.

The Charity Commission issued this alert along with a reminder of what to look out for when such requests are received, and a reminder of protection and prevention advice.

This is a stark reminder of how easy it is for an email address to be hacked and/or ‘spoofed’ and how important it is to have tight processes and policies in place when dealing with sensitive information, and in particular around any changes to bank details. Policies should be regularly reviewed and trustees should ensure that all staff and volunteers are aware of any comply with policies and processes.

If a charity is subject to any type of fraud, they should take the appropriate steps to report it to Action Fraud and as a serious incident to the Charity Commission.

ICO: Charities reported 108 data breaches to the ICO in the second quarter of 2019-20

The Information Commissioner’s Office (ICO) has published information regarding the latest data breach trends for the second quarter of 2019-20. It was noted that charities reported 108 data breaches to the ICO in the second quarter of 2019-20, fewer incidents than the same period of last year, where 137 incidents were reported.

Nearly 3,000 incidents were reported during the second quarter of the year across all sectors, with charities accounting for just 3.6% of all reports.

Most of the incidents involving charities were noted to be “other non-cyber incident”, as well as “loss/theft of paperwork or data left in insecure location”. There were also incidents of data being emailed or posted to the wrong person, as well as the failure to use blind carbon copy (bcc) on emails.

It is vitally important that trustees are aware of their responsibilities to keep data secure and to ensure that that all staff and volunteers within their charity are aware of and comply with processes and policies.

Recent High Court ruling: NHS trusts are not charities

A recent High Court ruling has stated that that NHS Trusts and Foundation Trusts may not be treated as charities, and are therefore not eligible for business rates relief.

Led by Derby Teaching Hospitals NHS Foundation Trust, a group of 17 trusts submitted that their properties, mostly hospitals, were wholly or mainly used for charitable purposes and as such they should be able to qualify for business rates relief. However, it was concluded by Mr Justice Morgan that “a foundation trust is not established for charitable purposes only, and therefore the preliminary issue should be answered by holding that a foundation trust is not a charity.”

This decision has been welcomed by the Charity Commission, who have stated that “charity has a distinct status in law, and it also has a special meaning in the eyes of the public. It is crucial that this special status is protected for the benefit of the public.”

Briefing Paper on Face-to-Face fundraising

The House of Commons has published a Library briefing paper on the regulation of face-to-face fundraising, a practice sometimes referred to as “chugging”.

The paper outlines the arguments for and against the use of “chuggers”, and the reasons why a charity may choose to fundraise this way. The paper refers to the Fundraising Regulator and Code of Fundraising Practice together with Charity Commission guidance on Fundraising amongst other sources.

Information regarding the regulations governing face-to-face fundraising are also detailed, including the rules under the the Charities Act, the Fundraising Regulator and Charity Commission Guidance.

The paper can be accessed here.

ICO: New consultation on draft Direct Marketing Code of Practice

The Information Commissioner’s Office (ICO) has published a consultation to seek feedback on its draft Direct Marketing Code of Practice. The consultation opened on 8 January 2020 and will close on 4 March 2020.

The draft code “aims to provide practical guidance and promote good practice in regard to processing for direct marketing purposes in compliance with data protection and e-privacy rules. The draft code covers the legislation as it currently stands – which for e-privacy means the Privacy and Electronic Communications Regulations 2003 (PECR).”

The production of the draft code follows a previous consultation in 2018 where the ICO sought views from relevant stakeholders. The ICO has also advised that it intends to produce additional practical tools, checklists etc. to support the code.

The consultation can be viewed and responded to via the ICO’s website.

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Gambling Commission: Consultation on society lottery reform

The Gambling Commission is consulting on proposed lottery reform measures intended to achieve the following outcomes:

• “To amend the limits within the LCCP [licence conditions and codes of practice] to reflect changes the Government plans to implement through secondary legislation; and
• Enable lottery consumers to make better informed decisions about whether to gamble”

This consultation follows a previous consultation on society lottery reform in 2018, and may be of interest to any charities or other bodies that use lotteries for fundraising purposes, and will be open for comments until 12 March 2020.

The consultation can be viewed and responded to here.