The RSPCA is facing renewed scrutiny of its governance after it emerged police are investigating suspected fraud involving hundreds of thousands of pounds at its south-east London branch.

Two men have been arrested in connection with the alleged offences, and a forensic audit into the branch has been taking place. Ivan House, who resigned as a trustee last October amid concerns about the way the situation was being handled, said the scale of the suspected fraud was believed to be between £330,000 and £450,000.

The RSPCA has been plagued by controversy in recent years. Peter Ralphs, the former chairman of the Shropshire branch of the charity, was jailed for three years in January after admitting he had abused his position to steal £184,000 from the charity.

Last July, the Tunbridge Wells and Maidstone branch was criticised by the Charity Commission over “concerning gaps in record keeping” in relation to the purchase of a cattery, which the daughter of the then national chair – and chair of the local branch – Daphne Harris was appointed to run and also lived in. It said there had been failures in the charity’s governance.

The following month, the commission issued an official warning to the RSPCA over a hefty payout to its former chief executive, saying trustees had failed to ensure the decision was properly made, and that their failings amounted to mismanagement. On that occasion it said it had experienced a concerning level of engagement with the RSPCA over its governance in recent years, given the charity’s size and importance.

A spokesman for the commission, responding to the latest fraud allegations, said: “A serious incident was reported to the commission in line with our guidance on reporting serious incidents and we opened a regulatory compliance case to assess the charity’s response to this serious incident.

“We expect the trustees to submit the findings of their internal investigation once complete, which we will review, as well as any necessary policies and procedures, including around financial controls, to ensure the charity has acted appropriately.”

The suspected fraud was discovered during an audit of the south-east London branch in June last year when it was found almost £16,000 had been spent on bills at Premier Inn hotels. House said subsequent investigations had raised further questions and the problems at the branch had left him with concerns about the national charity’s oversight.

The two men arrested were both branch trustees. All seven trustees who were in place have either been removed or left and three new trustees, all members of the RSPCA’s national council, have been appointed.

The Charity Commission website said the branch’s accounts for the financial year ending 31 December 2017 were 160 days overdue. Income in each of the previous four years was between £193,000 and £227,000. Annual spending ranged from £178,000 to £227,000.

The national RSPCA charity, which has a federated structure, received income of £141m in 2017 and spent £129m.

A RSPCA spokesperson said: “After concerns were raised about the running of the London South East branch, which is a separately registered charity from the national RSPCA, a financial review was launched. The issue has been referred to the police and we are not in a position to comment further but we would like to reassure our supporters that the branch continues to operate as usual.”

A spokesman for the Metropolitan police said: “Police received an allegation of fraud on 3 September 2018 relating to a charity based in Norwood, south-east London.



“On 12 September two men – aged 44 and 55 – were arrested on suspicion of fraud. Both have been released under investigation. Enquiries continue by officers from the south area command unit.”