South West Wales

Awema: 'Boss defrauded struggling charity' trial told

Naz Malik
Image caption Naz Malik denies three counts of fraud at Swansea Crown Court

A race equality charity chief's fraud trial has been hearing claims about how he used the organisation's cash to pay for life assurance for his wife.

The jury has also heard allegations that Naz Malik cashed cheques for more than £11,000 - saying the All Wales Ethnic Minority Association (Awema) owed him the money.

One of the alleged frauds was committed at a time when Awema was struggling financially, Swansea Crown Court heard.

Mr Malik denies three fraud charges.

The charity, which promoted diversity and equality projects across Wales, folded in 2012 when public funding was withdrawn after claims of financial mismanagement.

One of the allegations put before the jury was that Mr Malik took out a life assurance policy that would have paid his wife £120,000 if he died.

Awema footed the £90-a-month bill for the insurance policy, racking up over £3,500 between 2008 and 2012.

Mr Malik told police he had taken a personal salary sacrifice to cover the insurance costs, and life assurance policies were being developed as a benefit for Awema staff.

On Thursday, the charity's treasurer Stephen Matthews told the jury that at around the time the insurance policy was started, the charity was struggling financially.

'Relying on reserves'

Giving evidence, Mr Matthews said the charity was relying on its core Welsh government funding and reserves.

He said the charity was "in between projects" at that time, and without new projects the body "would have to fold".

The court then heard from the charity's financial director, who said Mr Malik had cashed two Awema cheques worth £11,840.

Saquib Zia said he handed over a pre-signed cheque for £2,500 in March 2010 after Mr Malik insisted he was owed the money for expenses, and he would provide the receipts later.

Mr Zia said he was reluctant to issue the cheque, but said Mr Malik was his boss and "he promised he would bring the claims up to date".

The second cheque cashed was for £9, 340.36 - an amount the prosecution claimed was the exact outstanding debt on Mr Malik's credit card account.

Mr Zia told the court Mr Malik had taken the cheque from his office while he was away on a day's leave.

"I was very nervous as the amount was substantial and I was cross because we hadn't sorted the original payment," said Mr Zia.

"I said we can't do this, you have to get approval from the board."

The former financial director said Mr Malik told him in an email that he "would explain it to the board members".

The trial continues.

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