Glendene academy investigated for paying wages of fundraising subsidiary

From the Independent:
UPDATE: Sunderland Echo

Police are investigating allegations of serious financial mismanagement at Glendene Arts Academy... the Education Funding Agency... seeking to recover at least £162,000 claimed to have been misspent... prompted by whistle-blower claims over the use of academy resources to pay the salaries of employees as well as the running costs of a private company (with the agreement of the Chair of Governors, <redacted> <redacted>, and
the Principal of the academy)'



The company whose employees salaries appear to have been paid by the academy, was set up before the school became an academy.

The DfE report said: 'We were informed that the original intention in setting up may have been to generate income (in the form of fund raising, donations or provision of training) for the academy, however this has not happened. Instead the set-up has resulted in the academy subsidising by paying staff salaries and other costs amounting to £162,729.38. We cannot identify any discernible benefit for the academy in this arrangement; it has resulted in the loss of over £162,000 that should have been used for the benefit of the academy pupils.'

Academies are allowed to generate incomes. (Evening Standard on raising funds from parents)

DfE report: https://www.gov.uk/government/publications/investigation-report-glendene-arts-academy

(PDF: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/279902/Investigation_report_Glendene_Arts_Academy.pdf)