The Australian Charities and Not-for-profits Commission (ACNC) and the Australian Securities and Investments Commission (ASIC) have partnered to urge banks and other financial service providers to change the way they interact with charities.
Since its formation in December 2012, the ACNC has received over 1,000 complaints from charities regarding the way banks and other financial services providers have tried to verify the information charities provide.
ACNC Commissioner Susan Pascoe AM explained that issues were caused by changes to the reporting requirements for charitable companies in December 2012.
“Prior to the establishment of the ACNC, charitable companies limited by guarantee were required to lodge reports with ASIC or notify them of common changes…… however, this has not been the case for over three years now,” Ms Pascoe said. “Since the establishment of the ACNC in December 2012, charitable companies, which account for around 10% of all registered charities, have been required to report to the ACNC instead”.
Therefore, anyone wishing to check the details of charitable companies should check the ACNC Charity Register, not the ASIC Companies Register, to ensure that they access current information.
ASIC Commissioner Greg Tanzer said, “ASIC is committed to working with the ACNC to educate the business community on the use of the registers.”
“Banks and financial services providers continue to check our companies register for details of charitable companies, despite messages directing them to the ACNC Charity Register.”
To help get the message across, the ACNC and ASIC are writing to dozens of financial sector representatives, and sending them a new factsheet that explains why they need to change their organisation’s work processes.
“We hope that once the message filters down within these organisations it will decrease the impost that charities are currently facing,” Ms Pascoe said. “While this may sound like a minor issue, it has put many charities under significant financial pressure. Over the last three years we have been made aware of hundreds of instances where charities have been denied loans and other financial assistance.”
As well as being denied bank loans, other issues reported by charities include: