Charities are facing increasingly complex attacks from malicious actors, sometimes exploiting overlaps between different regulators, according to the Charity Commission's second annual Charity Sector Risk Assessment. The report highlights a sustained increase in concerns regarding the abuse of charitable status for private benefit, with a 29% rise in cases in 2025-26.
The Commission notes an increase in "particularly complex case work," often involving charities operating across multiple regulatory bodies or where regulatory boundaries are unclear. This has led to the charity regulator formally sharing information with other agencies, including HMRC and the police, 500 times in the past year, an 8% increase.
The report also warns that some charities provide sensitive services to vulnerable groups in areas lacking subject-expert regulation, such as out-of-school settings and certain housing services. The Commission, as the charity law regulator, assesses governance and legal compliance but lacks the powers to ensure service quality or standards.
Financially, the sector shows early signs of recovery with a small increase in income, though this is uneven. Two in five charities saw spending exceed their income, and one in four charities with incomes under £10,000 reported only just breaking even in 2024.
Paul Latham, Director of Communication and Policy at the Charity Commission, stated that while most charities are well run, the assessment highlights the growing scale and complexity of risks, including exploitation for personal benefit and a lack of regulatory clarity that could expose service users to poor services or harm.