Fr Peter McVerry signed a legal document in a property deal in which his homeless charity spent almost €1 million buying nine properties from its then auditor, a report for the Charities Regulator has found. The deal was one of two involving the auditor.
Inspectors appointed by the regulator to investigate the charity said the then auditor, Donal Ryan & Associates, confirmed the €945,000 purchase of the properties in 2018 while acting as auditor of the Peter McVerry Trust.
“This represents a conflict of interest for the auditor,” said the inspectors, adding that the charity’s board became aware only in 2023 that the properties had been acquired from the auditor five years previously.
“The deed of indenture in relation to this property purchase dated October 31st 2018 is signed by the founder and the FY2021 auditor.”
The inspectors did not name individuals but Fr McVerry was founder of the charity in 1983 and Donal Ryan of Manor Street in Dublin 7 was auditor in 2021.
Fr McVerry declined to make a personal comment on the findings. The charity’s board, of which he is secretary, said work to rebuild its structures and processes was significantly advanced but would take time to complete. “The board acknowledges there were deficiencies in the trust’s financial controls.”
The inspectors went on to highlight a second McVerry Trust deal involving the auditor: a Co Kildare property was transferred to the auditor in October 2016 and ownership transferred later on the same day to the trust.
The inspectors cited former trust chief executive Pat Doyle – described as “former CEO 1″ – saying the trust asked the auditor to buy the property and transfer it to the trust “so that the fact that [the McVerry Trust] was purchasing the property was not publicly known”.
The former chief executive told inspectors “this approach was taken because the sale may not have completed if it was known” the trust was the buyer, the report said. “Former CEO 1 also confirmed that the board was not aware of this transaction at the time.”
Such findings were set out in an 82-page report for the regulator which criticised “failures in board oversight” in the trust, raising serious questions about how its assets were managed.
The housing body received some €140 million from State sources between 2019 and 2022 but ran into serious financial trouble in 2023, prompting a €15 million Government bailout last November.
The regulator’s report found a “lack of adequate and appropriate financial controls” with which the charity’s board could exercise control over its affairs.
The charity has since signalled it wants the State to fully fund it services for homeless people, ending a funding model based on 70 per cent State income and 30 per cent fundraising money.
The inspectors found there was “no evidence of active management of conflicts of interest” in the trust and criticised “inadequate management accounts” which failed to report the level of debtors, creditors or debt financing.
“The inspectors also identify a failure to adhere to donor intention in how restricted funds were used,” the regulator said.
The inspectors also found “inappropriate transfers between, and commingling of, restricted and unrestricted funds” in the trust.
The inspectors examined the trust’s takeover of other charities, asking whether the board considered the purpose of charities being taken over aligned with the trust’s purpose.
“The inspectors cite one case where the charitable purpose of the charity being taken over was the advancement of religion, which is not one of Peter McVerry Trust’s charitable purposes.”
Tendering procedures were not implemented or adhered to in other cases.