This article is more than 2 years old

This article is more than 2 years old

A charity operating as an influential pro-Brexit thinktank “crossed a clear line” in its political work, according to the charities watchdog.

In a report published on Friday, the Charity Commission said the Legatum Institute Foundation breached strict rules that ban charities from political activities.

The commission warned that a report produced by the Legatum Institute, called the Brexit Inflection Report, could be seen as “promoting a political view directed towards securing a particular negotiating position” to achieve a “particular final outcome”.

As a result, the charity’s trustees were ordered to remove the report from the thinktank’s website and be more cautious when publishing future reports on “controversial, highly political subjects”.

The institute’s output will be closely monitored in future.

The rightwing thinktank, which operates from a townhouse in Mayfair, was set up by the Legatum Group, whose founders include the New Zealand-born billionaire Christopher Chandler.

Early last month, the Conservative MP Bob Seely used parliamentary privilege to claim Chandler had been an “object of interest” to French intelligence because of his alleged links to Russian politics. The businessman has dismissed the claims of connections to Russia. He has also insisted that Legatum did not have a firm stance on Brexit, but was instead focused on prosperity.



Although the Legatum Institute charity was registered in 2011, it maintained a low profile before the Brexit referendum. As well as the Legatum Group, a private investment firm, there is also a non-charitable Legatum Foundation, which funded the report.

Facebook Twitter Pinterest Christopher Chandler, one of the institute’s founders, has been accused of having links to Russian politics, a claim he denies. Photograph: Afolabi Sotunde/Reuters

After the referendum, the Legatum Institute’s former economics directorShanker Singham held several meetings with the pro-Brexit cabinet ministers Michael Gove and Boris Johnson. The reported goal of these meetings was to increase pressure on Theresa May to leave the single market and customs union.

The institute also reportedly helped Gove and Johnson write a letter to the prime minister last autumn setting out their blueprint for a post-EU Britain. Legatum has said Singham had been sought out for his “unparalleled knowledge and expertise” and also that Chandler was “a much-loved friend of the institute” but that he had no role within it.

The institute’s chief executive is Baroness Stroud, who previously worked for the leading Brexiter Iain Duncan Smith.

There have been previous controversies over thinktanks and their charitable status. Several have become closely linked to political parties. Last year, the Institute of Economic Affairs removed two press releases from its website over concerns that they breached the guidance.

During the Charity Commission’s inquiry into Legatum, the trustees said the Brexit report was intended to “analyse and assess the implications of the different political choices available for the UK” on its ability to independently negotiate a trade deal.

The watchdog said the publication of the report had gone too far from the stated purpose of the charity, which is to advance the education of the public.

The institute recently announced that it had completed its work on Brexit, and has also severed its ties to Matthew Elliott, who ran the Vote Leave campaign and was hired as a senior fellow last year.

David Holdsworth, the commission’s chief operating officer, said: “Our case found that the Legatum Institute Foundation breached regulation with the publication of its Brexit Inflection Point report.

“Charities with educational purposes have a valuable role to play in public debates, but they must act responsibly. On such a highly political issue it is especially important that trustees can clearly demonstrate they are operating in line with our guidance to inform the public in a balanced and evidence-based way.

“With this report, the trustees failed to meet the required standards of balance and neutrality.”

The institute’s chair of trustees, Alan McCormick, said: “We are pleased that the commission has concluded its review of the Legatum Institute. As a board, the trustees take very seriously the institute’s responsibility to educate the general public about how individuals, communities and nations can create the pathways from poverty to prosperity.

“Over the past five months we have worked closely with the commission, proactively reporting relevant information and answering all questions posed to us. We are pleased to see the official recognition on the part of the commission that the institute operates independently and that we have systems in place which are designed to ensure balance and neutrality in our research and educational work.