The founder and former trustees of Kids Company are facing company directorship bans of up to six years following a Government investigation into the charity’s collapse.
Sky News can reveal that the Government’s Insolvency Service has informed the former board members of Kids Company – who include Alan Yentob, the ex-BBC creative director, and Richard Handover, a former boss of WHSmith – that it will bring proceedings to seek their disqualification.
In total, nine former directors are facing bans of between two-and-a-half years and six years, the Insolvency Service confirmed after an inquiry by Sky News.
Camila Batmanghelidjh, Kids Company’s founder, was not a director at the time of the charity’s demise in 2015, but the Insolvency Service proceedings will allege that she was a de facto board member and should therefore be subject to the same effort to disqualify her.
In a statement, a spokesman for the Insolvency Service said: “We can confirm that the Insolvency Service has written to the former directors of Keeping Kids Company informing them that the Business Secretary intends to bring proceedings to have them disqualified from running or controlling companies for periods of between two-and-a-half and six years.
“As this matter will now be tested in the court it is not appropriate to comment further.”
Sky News reported in April that the Insolvency Service was minded to seek the disqualification of the Kids Company trustees.
Ms Batmanghelidjh ran the charity on a £90,000 annual salary and vehemently defended its governance even as it lurched towards bankruptcy.
The charity’s collapse in the summer of 2015 was a major embarrassment to David Cameron, the then Prime Minister, who had backed a £3m Government grant to the charity little more than a month earlier.
He had said that the valuable work undertaken by Kids Company meant it was worth giving it “one more go” and was so moved by Ms Batmanghelidjh’s work that she was awarded a CBE while Mr Cameron was PM.
The charity claimed to support 36,000 children and young adults, working with those who were struggling with mental health issues after being involved in gun and gang crime, or who were suffering from neglect.
Image: Alan Yentob is a former Kids Company chair of trustees
In total, it received £42m of public money over a 15-year period – although some media reports have put that figure at as much as £50m.
It eventually closed its doors, though, after the Metropolitan Police launched an investigation into allegations of abuse at the charity.
A damning report by MPs in February 2016 outlined an “extraordinary catalogue of failures”, with its board of trustees reliant on “wishful thinking and false optimism”.
The Commons public administration committee said trustees had ignored repeated warnings from auditors about Kids Company’s financial position.
It also accused senior politicians of being in thrall to Ms Batmanghelidjh.
The Insolvency Service, which is part of the Department for Business, Energy and Industrial Strategy, is required to investigate company insolvencies, although its reports are never published.
If the proceedings do result in the banning of Mr Yentob and his former colleagues from serving as company directors, it would represent a huge blow to the reputation of one of Britain’s best known media figures.
Mr Yentob chaired Kids Company for 12 years, but stepped down from his BBC role four months after the charity’s collapse, saying his continued service was “proving a serious distraction” to the Corporation.
He had been accused of editorial interference after criticising BBC journalists’ coverage of Kids Company’s financial problems.
Companies House filings show that he is a director of a company called I Am Curious, a television production business he established last year.
His fellow trustees included Mr Handover, a former chief executive, then chairman, of the high street retailer WHSmith.
Two of his children were reported in 2015 to have been on Kids Company’s payroll.
Other directors included Andrew Webster, a former executive at the drugs company AstraZeneca, and Erica Bolton, an arts publicist.
A separate review by the Charity Commission into Kids Company is reported to be ongoing.
Source: Sky News