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The chief executive of the Peter McVerry Trust has raised concerns about the “potential mismanagement” of donations made to the homelessness charity, as well as “repeated and long-standing governance failings” over several years.
Francis Doherty, who took over as head of the trust this June, tendered his resignation on Wednesday, stating the charity’s board had made his position “untenable”.
In a resignation letter, seen by The Irish Times, Mr Doherty said he had identified a “substantial amount of concerning information” about practices that predated his appointment.
These included the “potential mismanagement of donor funds”, the transfer of “restricted funds from the charity to a private business”, as well as issues around “huge” expenditure on a homeless hostel in Co Kildare run by the trust.
He said that when he took over, the charity did not have enough money to pay staff, creditors or meet Revenue commitments.
The letter to Deirdre-Ann Barr, chair of the board, stated that by July the charity was facing “imminent financial collapse”.
Findings from an independent review by auditors PwC indicated financial problems “had arisen over a number of years”, which Mr Doherty said pointed to “repeated and long-standing governance failings”.
Last month, the Approved Housing Bodies Regulatory Authority (AHBRA), who regulate non-profit housing bodies, launched a statutory investigation into financial issues at the charity.
Mr Doherty claimed a “gagging order” had been put on him discussing the trust’s financial situation with State funders or regulators without the sign-off of the board, which he said was an “unreasonable restriction”.
During a late September meeting, he claimed he was told by the board only “the minimum amount of information” should be shared with regulators.
The correspondence revealed the charity owes €6.9 million to trade creditors, with some suppliers threatening to stop providing services.
The letter claimed the board had “assumed control” of decisions about which creditors should be paid and when.
The trust had come under “enormous pressure” from creditors last week, Mr Doherty wrote. One company providing agency staff had threatened to withdraw its workers in recent days “due to our failure to pay overdue invoices”, he said.
The senior executive said there had been a “lack of urgency” in how the board responded to concerns he raised about financial matters.
To raise funds the charity had sold a property used for homeless accommodation in Santry, north Dublin, for €1 million, with plans to bring in a further €5.87 million from the sale of more properties.
Mr Doherty, who was previously the charity’s director of housing and communications, said his decision to resign had “not been taken lightly”.
A spokeswoman for the charity said it was “disappointed” Mr Doherty had resigned, but its priority was the continuity of care for those in its services.
“Our focus remains on the future of the organisation. We will co-operate with all stakeholders to achieve that as best as possible,” she said.
The board didn’t respond to a series of questions from The Irish Times about specific claims made by Mr Doherty in his letter.
The charity is one the largest providers of homeless services in the State, with an income last year of about €60 million, the majority of which comes from State funding. It was set up by Fr Peter McVerry 40 years ago, who remains secretary of the board.
A Department of Housing spokesman said Minister for Housing Darragh O’Brien has sought confirmation from the charity’s board that its services would “continue uninterrupted” following the chief executive’s resignation.
The spokesman said the Government’s priority was the continuity of homeless services provided by the trust.
“Given the ongoing processes and the AHBRA investigation, the department will not be commenting any further,” he said.
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