I am the part-time director of a charity, and also have a business. Is it legal for my business to sell materials to the charity, if the Board approves the sale? Is it legal for the charity’s administration to demand that I donate the proceeds of the sale back to the charity?
Ann Kiernan replies:
As long as you have fully disclosed your ownership interest in the supplier, and you are giving the charity a fair price for the goods you are supplying, the business arrangement sounds OK to me. The mandatory kickback-disguised as a donation-does not! Please run this idea by the charity’s legal counsel.
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