TaxCorporate TaxUK banks raise £234bn through charity trust scheme

UK banks raise £234bn through charity trust scheme

Major banks create charitable trusts to raise funds but have not donated to the charities

The UK’s major banks have raised tens of billions of pounds in funds by
exploiting a loophole in the charity trust laws.

Concerns had been raised over Northern Rock’s charitable trust Granite,
through which the bank raised funds against its mortgages but has not paid
anything to its nominated charity.

It has now been revealed that 11 other major high street financial
institutions are operating similar schemes, through which they have raised funds
on the back of £234bn of home loans, reported
The
Guardian
.

The use of the trusts is controversial, as the trusts are kept off the
balance sheet.

Most do not name the charity that is the supposed beneficiary. Only Abbey and
Bradford & Bingley said they had had made donations to their charity.

Treasury select committee chairman John McFall said that if charities’ names
were being used then it must be clear who they were, ‘otherwise it could be seen
as identity theft’.

Further reading:

See
The Guardian’s story

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