Captain Tom: where did the money go?

This article was first published on 13 November 2023 with additional information added on 7 February 2024.

The Captain Tom Foundation is at the centre of a storm of controversy surrounding Captain Sir Tom Moore’s family. The charity is currently the subject of a Charity Commission Statutory Inquiry and on Sunday 12 November a documentary aired on Channel 5, entitled “Captain Tom: Where Did the Money Go?”, with a subsequent documentary titled “Captain Tom: What Happened Next?” aired on Sunday 4 February, in which I feature and provide commentary from a charity law perspective and Tom Newcombe provides commentary from a planning law perspective.

In this article, I explain in greater detail the legal issues that were explored during my interview for the documentary.

Captain Tom’s legacy

Captain Sir Tom Moore won the hearts of the British public in April 2020 when he walked 100 lengths of his garden to fundraise for NHS Charities Together at a time when the country was in lockdown and the NHS was under extreme pressure, with key workers at the frontline of the COVID-19 pandemic. He raised an astonishing £39 million – an extraordinary and unprecedented sum for a member of the public to raise, as recognised by the love and adoration of the British public and his subsequent knighthood.

Nobody could have predicted that this simple altruistic act would catapult ‘Captain Tom’ to become a household name overnight. In the wake of the outpouring of public love and support for Captain Sir Tom, he and his family set up a charitable foundation, which was officially launched on 17 September 2020 “to inspire hope” and create an enduring legacy in his name. Speaking at the launch of his Foundation, Captain Sir Tom said: “Now we can all stand shoulder to shoulder to make sure Tomorrow will be a good day.”

What went wrong?

As explained in our article last year, things began to go wrong in 2022 after the Foundation published its first Annual Report and Accounts. The Charity Commission launched a Statutory Inquiry on 16 June 2022 after a series of high-profile stories hit the headlines. Concerns were raised regarding various arrangements between the family and the Foundation. Since then, further issues have arisen, most recently in relation to the ‘spa building’ constructed at the family home, which the family have now been ordered to demolish.

In summary, the issues that have hit the headlines are as follows:

• Employment of Hannah Ingram-Moore as Interim CEO of the Foundation.
• Public appearances by Hannah connected with the Foundation for which she received a fee.
• Payments made from the Foundation to companies owned by the family.
• Registration of the “Captain Tom” trademark by Club Nook Limited, a company owned by the family.
• The marketing and sale of “Captain Sir Tom’s Gin”.
• What happened to the proceeds from the sale of Captain Sir Tom’s autobiography and children’s books.
• The construction of a ‘spa building’ by the family at their family home, having submitted an application for planning permission to construct the “Captain Tom Foundation Building”.

The cumulative impact of the waves of controversy has been catastrophic for the Foundation, with donations falling from over £1million in its first year to less than £400k in its second year. The Foundation announced in July 2023 that it would stop accepting donations whilst the Statutory Inquiry remains open. Its website currently states:

“At this moment in time, the sole focus of The Captain Tom Foundation is to ensure that it cooperates fully with the on-going Statutory Inquiry by the Charity Commission. As a result, The Captain Tom Foundation is not presently actively seeking any funding from donors. Accordingly, we have also taken the decision to close all payment channels whilst the Statutory Inquiry remains open.”

There has been speculation as to whether the Foundation will recover at all and it has recently been reported that the family’s Barrister, Scott Stemp, has said: “It’s not news to anybody that the Foundation, it seems, is to be closed down following an investigation by the Charity Commission”.

What are the legal issues for the Foundation?

There are three key issues from a charity law perspective at the heart of every story that has hit the headlines :

1. To what extent have there been any personal benefits for the family in connection with the Foundation that are unauthorised and/or ‘more than merely incidental’?
2. Have conflicts of interest been appropriately managed?
3. Have the charity trustees failed in their legal duties and responsibilities to the Foundation?

To be recognised as a charity in England and Wales, an institution must be established with charitable purposes for the public benefit. The ‘public benefit requirement’ is critical, and a central feature of it is that there must be no more than an incidental private benefit arising from the charity’s activities. This requirement is particularly important in relation to founders, charity trustees and anyone connected with them. As such, the Charity Commission looks closely at any scope for private benefit when registering new charities, and it is often an aspect of the registration process that is carefully interrogated.

The public benefit requirement is not just a registration issue: it exists throughout the life of a charity and charity trustees have a legal obligation to report each year on how the activities of the charity have advanced the charity’s purposes for the public benefit. Additionally, any circumstances where a charity trustee or any person connected with them might benefit from the charity must be expressly authorised: within the governing documents of the charity, by statute or by the Charity Commission or courts.

Charity trustees also have a duty to identify and appropriately manage any conflicts of interest in their decision-making. This requirement is set out in Charity Commission guidance on conflicts of interest (CC29) and also in its guidance on decision making (CC27). A further important point to note is the duty for charity trustees to safeguard the assets of the charity, which includes the charity’s reputation.

Hannah’s appointment as Interim CEO

Captain Sir Tom died on 2 February 2021, having been admitted to Bedford Hospital on 31 January with COVID-19 and pneumonia. Around the same time, Captain Sir Tom’s daughter (Hannah Ingram-Moore) and son-in-law (Colin Ingram-Moore) were appointed as trustees of the Foundation (on 1 February 2021). Hannah resigned as a trustee several weeks later (on 15 March 2021), presumably because it had been proposed that she be employed as the Foundation’s Interim CEO.

The public benefit requirement means that employing a charity trustee or a person connected with them (which includes a trustee’s spouse, as in this case) must be expressly approved. Any conflicted trustee must also not participate in any of the decision making. As such, and as required by charity law, the independent trustees of the Foundation applied to the Charity Commission for consent to employ Hannah. Following a period of engagement with the Commission regarding the proposed salary for Hannah’s employment, consent was given:

“In August 2021 the Commission permitted the charity to appoint Hannah Ingram-Moore as interim CEO on a salary of £85,000 per year, on a 3-month rolling contract, for a maximum of 9 months whilst the trustees conducted an open recruitment process.”

The proper process was clearly followed here, and so Hannah’s remuneration as Interim CEO cannot be called into question as a matter of charity law. This was an authorised personal benefit, approved by the Charity Commission in advance.

As I said in the documentary, it is not uncommon for the public to become concerned about the salaries of charity CEOs. However, it is important to remember that charities cannot achieve what they do without high quality leadership. Employees need to be remunerated and, like any other employer, charities have to offer competitive salaries to attract the right people. Provided that those salaries are appropriate to the role and responsibilities involved and are benchmarked appropriately, this should not give rise to concern.

Hannah’s public appearances

During her tenure as Interim CEO, Hannah was one of the judges for the Virgin Media O2 Captain Tom Foundation Connector Awards. It was reported that she was paid an appearance fee for her attendance, which has attracted some criticism. In an exclusive interview with Piers Morgan, Hannah explained that she was paid a fee of £18,000 (via Maytrix Group Limited) and that the Foundation received a donation of £2,000.

The Charity Commission is likely to look at the charity trustees’ decision making in connection with this event, given that the Foundation’s name and logo was associated with it, and Hannah was both an employee of the Foundation and the wife of a charity trustee at the time. There are important questions to be answered here regarding the private benefit to Hannah and how conflicts of interest were managed by the charity trustees.

Payments to Club Nook and Maytrix Group Limited

Another issue that was considered by the Commission before the Statutory Inquiry was opened was the issue of payments to Club Nook and Maytrix Group Limited, both companies owned and controlled by the Ingram-Moores, which were disclosed as related party transactions in note 13 to the charity’s first Annual Report and Accounts.

There is a statutory power for companies connected with charity trustees to provide services to charities, provided that certain steps are followed to appropriately manage conflicts of interest. In relation to these particular points, the Charity Commission has already stated that it is “satisfied that these specific payments are reasonable reimbursement for expenses incurred by the companies in the formation of the charity”. As such, this does not form part of the Statutory Inquiry.

Registration of the “Captain Tom” trademark

Only weeks before setting up the Foundation (which was formed as a charitable company on 5 May 2020 and then registered as a charity a month later on 5 June 2020), on 24 April 2020, Hannah and Colin set up a family company called Club Nook Limited.

On 18 May 2020 the company applied to register “Captain Tom” as a trademark in a number of classes. The company subsequently applied to register several variations of the trademark. The Charity Commission has cited “a failure to consider intellectual property and trade mark issues when the charity was established” as a key concern in its announcement of the Statutory Inquiry into the Foundation. The question here is whether the charity trustees should have objected to the registration of the brand in order to protect the Foundation.

Again, there is a question to be considered by the Commission as to the extent to which the family might have obtained private benefits from its ownership of the brand, given the high-profile nature of the charity and the strong association of the brand with ‘charity’ in the public mind. However, it has been reported that Stephen Jones, chair of trustees at the Foundation, said that the Charity Commission was informed about the ownership of the trademarks when the charity was set up. If so, it might be difficult for the Charity Commission at this stage to criticise the charity trustees for failing to consider these issues at the time.

Captain Sir Tom’s Gin

In November 2020, the Otterbeck Distillery launched a new Captain Tom branded gin and it was widely reported that sale proceeds would support the Foundation.

It is common for charities to enter into partnerships with companies for the sale of goods and services associated with the charity name and brand. This is known as ‘commercial participation’ and it is an important method of fundraising for many charities. It is perfectly legal, provided that the statutory requirements are met, and a key legal requirement is that the commercial participator (i.e. the commercial company with which the charity has partnered) discloses clearly which charity or charities will benefit and how much of the sale proceeds will be paid to the charity or charities concerned. This is known as a ‘solicitation statement’.

When the gin was first launched, the marketing materials did not include a compliant solicitation statement. Questions were raised about this by The Independent, after which it was made clear that £1 from every bottle of gin sold would be donated to the Foundation.

The Charity Commission might investigate this as part of the Inquiry. Whilst it is the responsibility of the commercial participator to comply with the legal requirements, in practice, it is important reputationally for charity trustees to follow the rules and ensure that any commercial participator with whom the charity partners makes a compliant solicitation statement.

What is not yet clear is whether there was any private profit for Club Nook arising from the use by Otterbeck Distillery of the “Captain Sir Tom” brand (which is owned by Club Nook). Hannah and Colin stated in their interview with Piers Morgan that Club Nook has not made any money from any “Captain Tom” themed merchandise. So, it is possible that Club Nook licensed the use of the trademark to the Foundation without charge and that the Foundation entered into a commercial participation agreement with Otterbeck Distillery.

Club Nook and the books

Captain Sir Tom wrote three books: his autobiography ‘Tomorrow Will Be A Good Day’ and two children’s books. In an announcement made by the Foundation on 14 May 2020 about Captain Sir Tom’s autobiography and his children’s picture book, the Foundation stated on its website that “both books will support his newly formed charity – The Captain Tom Foundation”, and a tweet on Captain Sir Tom’s official account it said “The book will support the launch of the Captain Tom Foundation”. The autobiography also includes a reference to the Foundation in the prologue:

“Astonishingly at my age, with the offer to write this memoir I have also been given the chance to raise even more money for the charitable foundation now established in my name.”

During the Piers Morgan interview, when questioned about how Club Nook’s income of c.£809k in its first year was raised, Hannah and Colin stated that “the vast majority of that money came from the three books… 95% of it”. Hannah also explained that Captain Sir Tom’s wishes were that the income from the sale of the books should go to Club Nook and that “they were never anything to do with the charity”.

In the Channel 5 documentary, I explained that this is problematic, and it is. There were several public statements implying that the income from the books would support the Foundation. If, as stated by the family in their interview with Piers Morgan, this was not the case then the charity should not have been involved in promoting the book at all.

The activities of a charity must be carried out to advance the charity’s purposes for the public benefit. As such, it is not appropriate for a charity to promote the sale of a privately owned product where there is no benefit to the charity. In this case, there is a possibility that the Commission might take the view that the promotion of the books by the Foundation resulted in more than merely incidental private benefit to the family in breach of charity law requirements. As such, this is likely to be something that the Charity Commission will be looking at in its Statutory Inquiry.

The controversial ‘spa building’

Probably more than anything else, the controversy surrounding the construction of a ‘spa building’ in the grounds of the Ingram-Moore family home has sparked public outrage. The original planning application was to build a “Captain Tom Foundation Building”. The application was approved, and construction commenced, but the family later applied retrospectively for permission for a substantial extension to the original plans, including a wing for a spa pool. The application was denied and following an appeal, the family have been ordered to demolish the building.

The family were clear in the interview with Piers Morgan that they paid all costs associated with the building. They also explained that it was a mistake that the original planning application was made in the name of the Foundation. However, the use of the Foundation’s name on the original application is problematic for Colin, as a charity trustee.

Again, this gives rise to a question about private benefit and whether conflicts of interest were properly managed. Whilst none of the charity’s funds were used for the construction of the building, it is unclear whether the family would have received approval for the plans had the original application not been associated with the Foundation. As such, it can be argued that there has been a benefit arising for the family as a direct result of Colin’s role as a charity trustee.

Conclusion

The charity law issues here are complex, and it is important to remember that we do not have all the facts. The opening of a Statutory Inquiry by the Charity Commission indicates that the Commission has serious concerns, but it is not a finding of fault. So, it is important to await the outcome of that Inquiry before jumping to any conclusions. However, publicly available information does shed light on the serious nature of the issues under investigation.

The Charity Commission is examining “whether the trustees of the Foundation have:

• been responsible for mismanagement and/or misconduct in the administration of the charity and whether, as a result, the charity has suffered any financial losses, including through any unauthorised private benefit to any of the current or previous trustees;
• adequately managed conflicts of interest, including with private companies connected to the Ingram-Moore family; and
• complied with and fulfilled their duties and responsibilities under charity law.”

Once a Statutory Inquiry is open, the Charity Commission’s full arsenal of statutory powers are available, and the Commission can investigate any issues of concern that arise. It is possible for the Commission to implement protective measures to protect the charity’s assets where required, and there is also a power to disqualify individuals from acting as charity trustees, if the Commission finds that this is warranted. In more extreme cases, where the Commission finds that a charity has suffered a loss because of a breach of duty by a charity trustee, that individual might be required to make good that loss. However, this is rarely seen in practice, and is usually reserved for extremely serious cases of gross misconduct, or fraud.

The Birketts view

It is by no means clear that the Charity Commission will find that Colin or any of the independent trustees have intentionally mismanaged the charity. I can also understand why the family has said publicly that they don’t believe they have done anything wrong, and I feel a great deal of sympathy for them. Nobody deserves the hatred and vitriol that has been levelled at them.

It is perfectly normal and entirely acceptable for a high-profile individual (or company) to set up a charitable foundation that shares their name and brand. There is no legal requirement for a person to transfer ownership of the brand to the charity upon formation and there is no public expectation that all income of that individual (or company) will go to the charity. You would not, for example, assume that every time you buy an Ed Sheeran album or buy tickets for one of his gigs that all proceeds will go directly to the Ed Sheeran Suffolk Music Foundation. So, it is understandable that Captain Sir Tom Moore’s family did not feel it was problematic for them to retain ownership of the copyright in his books and the intellectual property in the ‘Captain Tom’ brand and to use it to make money for themselves. However, there are issues in this case due to the strong association of the brand with charity.

In most cases, a brand is already well established commercially before an individual (or company) sets up an associated charitable foundation. As such, there is significant value for the charity through association: the benefits of the brand’s profile flow to the charity. However, in this case, it is arguably the other way around. The “Captain Tom” brand is so closely aligned with charity and altruism in the minds of the British public that people are likely to assume that any activities using the name and brand are for the charity. As such, the benefits of the brand’s profile in this case arguably flow from the charity to the family where they are simultaneously commercialising the brand without making that clear to the public.

What I think has been overlooked in this case is that the ‘Captain Tom’ brand is so inextricably linked with charity in the public mind that it was always going to be difficult for the family to try to commercialise that brand at the same time as setting up a charitable foundation. To make matters worse, it was not made clear when the brand was being used for private gain, which has resulted in a great deal of public mistrust and outrage. This is, in my view, the biggest mistake that has been made.

Regardless of the outcome of the Statutory Inquiry, from a public perspective the problems all stem from a lack of clarity as to when the ‘Captain Tom’ name and brand was being used to raise money for the family and when it was being used to raise charitable funds for the Foundation. In my view, there are some important lessons to be learned from this for any budding philanthropists. It is always essential to keep the private and charitable uses of a shared brand clear and distinct. Not only is this critical as a matter of charity law; it is also important in protecting the charity’s reputation and ensuring that the charity trustees are acting in accordance with their legal duties and responsibilities.

If you missed the first documentary, you can watch it on My5 here. You can also now watch the second documentary on My5 here.