Matthew Backhouse

Matthew Backhouse is an APNZ news reporter based in Wellington.

Cancer trust freezes fundraising

Internal Affairs launches inquiry, Serious Fraud also evaluating as charity reveals 40 per cent of funds sent offshore.

In January, the trust notified Internal Affairs that 38 per cent of its New Zealand-sourced funds were spent overseas.  Photo / Supplied
In January, the trust notified Internal Affairs that 38 per cent of its New Zealand-sourced funds were spent overseas. Photo / Supplied

A cancer charity has suspended fundraising in New Zealand amid questions over how its money is spent.

It has also been revealed that nearly 40 per cent of its funds go offshore.

The Cancer Research Charitable Trust was last week revealed to have donated less than 5 per cent of the $1.1 million it collected from New Zealanders over four years, with the rest going towards staff and administration costs.

The Department of Internal Affairs, which oversees registered charities, has launched an urgent review of the trust.

The Serious Fraud Office is also evaluating the matter, and police say they will await the outcome of those probes before acting on a complaint.

The trust yesterday said it had written to Internal Affairs to advise it had suspended fundraising in New Zealand while it addressed concerns raised last week.

Trustees would also meet this week to consider changing the trust's name, given its focus had shifted from research grants to public awareness campaigns.

But questions remain over where the trust's money is being spent.

In a 2007 press release, the trust said funds raised in New Zealand were used exclusively for New Zealand projects, but APNZ can reveal nearly 40 per cent of the trust's money is spent in Australia, where its executive officer is based.

Under the Charities Act, a registered charity must state the percentage of its annual income spent overseas. The information is then given to Inland Revenue.

In January, the trust notified Internal Affairs that 38 per cent of its New Zealand-sourced funds were spent overseas. The total amount is not yet known because the trust's latest financial returns are not yet publicly available.

Its executive officer, Gold Coast lawyer Troy Manhire, would not go into financial detail yesterday but said the money spent in Australia went towards New Zealand projects. He gave the production of cancer prevention pamphlets as an example.

The research, writing, design and printing might take place in Australia, but the pamphlets themselves were distributed in New Zealand.

"You're trying to draw some conclusion that in some way we've misled people - that's not the case."

Fundraising Institute chief executive James Austin said he was "very shocked" to hear just how little money went towards research. "They should lose their charitable status." "

In 2009, Mr Manhire was investigated for fraud in South Australia, after pocketing a salary close to A$500,000 ($625,000) from the Cancer and Bowel Research Association.

No charges were laid but the charity was stripped of its licence. It was reinstated by the Office of the Liquor and Gambling Commissioner on the strict condition that Mr Manhire was not involved in its management "in any way".

Push for stricter charity controls

Charities which collect cash door-to-door need tighter regulation and commission-based canvassers should be outlawed, professional bodies say.

The calls for stricter controls come as Internal Affairs looks into the Cancer Research Charitable Trust, which has donated less than 5 per cent of its income from door-to-door collections over four years.

The Fundraising Institute NZ (Finz), whose membership includes 500 individuals and 157 organisations, said it was concerned if much more than 20 per cent of a charity's money was spent on costs. Oxfam NZ aims to keep overhead costs at around 5 per cent. World Vision has used 79.6 per cent of its cash over the last five years on overseas development work.

"All the good guys and girls out there - which is 99 per cent of fundraisers - suffer because of cases like this," Finz chief executive James Austin said.

The Public Fundraising Regulatory Association, the industry body which has oversight of charities which raise funds through regular monthly donations, is pushing for tighter regulation.

- APNZ

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