Charities regulator moves against children’s charity

Posted on 18 Jul 2024

By Greg Thom, journalist, Institute of Community Directors Australia

The Australian Charities and Not-for-Profits Commission (ACNC) has confirmed it has de-registered a charity that claims to save vulnerable children from human trafficking.

The ACNC pulled the registration rug from under Project Rescue Children (PRC) amid accusations the Australian based organisation founded by former soldier Adam Whittington fabricated stories to fuel donations.

The Age newspaper reported details of a recent BBC podcast that accused the charity of making false claims about its rescue centres in Africa.

The claims included using unsuspecting children as props to attract donations.

An ACNC spokesperson confirmed to the Community Advocate that the regulator had revoked PRC’s registration and that the online Charity Register had been updated to reflect the charity’s new status.

“The register shows this was due to compliance action,” said the spokesperson.

While unable to go into detail about the circumstances that led the ACNC to act, the spokesperson said that “generally speaking, revocation of charity registration is the most serious action the ACNC can take.”

Once a charity loses registration it is no longer eligible for Commonwealth tax concessions and other benefits that charities are entitled to receive.

The 10th edition of the Australian Charities Report, released in June, revealed the ACNC revoked the registrations of just seven charities for compliance reasons in the 2022 reporting period.

“Although the revocation is displayed on the Charity Register, the ACNC is prevented from disclosing any information other than what is published on the Register due to secrecy provisions in the ACNC Act,” the spokesperson said.

Division 40 of the ACNC Act and subdivision 40-A of the Australian Charities and Not-for-profits Commission Regulation 2013 (Cth) set out the information that the ACNC is permitted to publish on the Register.

Paragraph 40-5(1)(b) of the ACNC Act sets out what that the ACNC can publish about formerly registered charities. 

“This does not include financial reports and other documents,” the ACNC spokesperson said.

According to the few details remaining on the Charity Register, PRC is a Public Benevolent Institution (PBI) whose mission is advancing social or public welfare and advancing education.

ACNC PRC deregistration screenshot — The ACNC website now lists Project Rescue Children as a deregistered charity.

"Where serious breaches have occurred and a charity does not adequately address the ACNC’s concerns, we will use stronger powers which may include revocation of the charity’s registration.”

ACNC spokesperson.

In December 2023, Charities Minister Andrew Leigh reiterated the government’s plans to lift the veil of secrecy preventing the ACNC from speaking out in relation to investigations.

He said existing legislation would be amended to allow the regulator to discuss ongoing investigations where necessary to maintain trust and confidence in the sector.

“The risk of the current laws is that if the regulator is muzzled from speaking out under any circumstances, it undermines trust and confidence in the sector,” he said in a speech to federal parliament.

“Our reforms will mean that – subject to a public harm test – the regulator can disclose that it is investigating allegations of misconduct.”

Mr Leigh said this would increase confidence in the sector as people saw the regulator pursue misconduct.

In November the ACNC published its first “deidentified” charity registration decision under a new framework designed to allow greater transparency of its inner workings.

The reasoning behind the decision did not include any detail that could identify the organisation that had applied for registration.

The publication of the decision was the first under the ACNC’s Secrecy Reforms Project, which will see the regulator release more information relating to its regulatory and compliance activities.

In the case of registrations, the information will be published in the form of de-identified reasons for decisions to approve or refuse organisations’ applications to register as charities.

PRC screenshot — Project Rescue Children says it's core mission is to protect, rescue, and support children from child trafficking, predators, and exploitation.

Among the allegations against PRC by the BBC are that Mr Whitington misled donors by falsely claiming on social media his charity had rescued a baby from people traffickers in The Gambia – despite the baby being safely at home with its mother at the time.

PRC has denied the allegations.

The ACNC said it would investigate concerns that a charity had breached its obligations under the law and would act when there was evidence that a charity had done so.

“The action we take is proportionate to the wrongdoing we find. Our powers range from warnings and agreements to penalties and revoking the registration of charities.” 

The ACNC said this process took time and involved ongoing interactions until the matters were resolved and the regulator was satisfied a charity could operate within the law and its obligations.

“However, where serious breaches have occurred and a charity does not adequately address the ACNC’s concerns, we will use stronger powers which may include revocation of the charity’s registration.”