£63,000 financial irregularities at Tower Hamlets community centre

Whisper it quietly but at the last Tower Hamlets Council cabinet meeting on 21st March there was public mention of the financial irregularities at Raines House – this is the reason the Wapping community centre was taken back into Council control earlier this year.

These irregularities have not been widely publicised until now.

Raine’s House, Wapping, E1W

North of £63,000 adrift?

LW first enquired about this in January this year (no reply) and has spent the last two days trying to get the facts on what happened only to discover some of this information was in the public domain. But nobody told residents – or voters.

It seems the Council is owed around £30,000 and £15,000 owed to utility companies. The former tenant at Raines House collected £18,000 of rental income annually from an illegal sub-let.

The Aspire Party was quick to latch on to the Raines House issue.

It is not clear if the total sum adrift is £63,000 or much more, the total would depend on how many years the illegal sub-let operated.

The Metropolitan Police states that that they have not carried out any investigations into financial irregularities at Raines House.

The initial response by a Tower Hamlets council spokesperson to LW is given below:

Statement by Council re Raines House

“Raines House is a Council-owned building – which means we also manage any agreement put in place to occupy the property. We’re happy for our buildings to be used by community groups and organisations, such as social clubs, however it’s imperative that the tenancy conditions in all cases are fully met,” said a spokesperson for Tower Hamlets Council.

“Unfortunately a number of such conditions were breached by Raines House’s former tenant. This has led to the Council being owed money for the Community Meals Service it provided and debts to utility companies.

An investigation also discovered that part of the building was sub-let without our agreement and rent was collected directly by the tenant.”

“As a result of these breaches and the money owed, we decided in January 2018 to end the occupation agreement and as a result, the Council now directly manages the building.”

We then asked the Council some specific questions and these are the answers we got back:

Q: What time frame did these financial irregularities take place in?

A: The financial irregularities were identified in 2017. The breaches took place for several years prior to that.

Q: Was this issue in any way related to the decision to undertake a refurbishment program at Raines House?

A: The decision to refurbish Raines House is due to the current condition of the building.

Q: How much money was owed to the Council and how much to utility companies?

A: Tower Hamlets Council is owed around £30,000 and an additional £15,000 is owed to utility companies. The former tenant collected £18,000 worth of rental income annually from the illegal sub-let.

Q: Have any criminal charges or allegations been made against any individuals?

A: It’s the Council’s responsibly to protect the public’s money and we are able to pursue civil or criminal proceedings if there’s sufficient evidence to do so. However, we’re unable to comment whether we’re pursuing proceedings as it could alert people who would be in a position to conceal or hide evidence.

No money since Lutfur left

Only official bookings allowed at Raines House now.

We also talked to Harry White who ran the club for many years before the January 2018 takeover and he explained the huge problems the Raines House team have had since their grants were cut after Rahman was kicked out of offic

“We have not had a penny from Tower Hamlets since Lutfur went,” says Harry.

Harry said that because the Raines House Lunch Club was not being funded by the Council the staff took their wages out of the dinner money.

In the phone interview with LW Harry also said that he was not aware of any Met Police investigations into activities at Raines House although he had made a voluntary statement to the police about an unrelated matter.

Where’s the bar?

The future of the bar in Raines House still seems to be uncertain.

Harry says that he has been told by both the Mayor and Anne Sutcliffe that whatever happens the bar will be kept – but this promise is never confirmed in writing.

Is the bar in Raines House being retained or not? We also asked the Council about this and were told that as the consultation for Raines House is still ongoing no decisions have been made. The proposals can be read here.

LW Comment

So how on earth did we miss this? In our own back yard?

Well one reason is that the Council never replied to our email of 31st January 2018. But that’s pretty standard to be honest.

Moley bad! We should have chased sooner. Assume nothing! Challenge everything!

The other curious thing is that when it was found that Lutfur Rahman’s Lunch Clubs were just another scam to get cash to his supporters all hell broke loose.

But when there is a problem with a community centre in Wapping nobody in the Council – and certainly none of the politicians we have spoken to the last few months – says word one.

Maybe £63k is just not worth mentioning in the scheme of things in Tower Hamlets?

Or maybe all the politicians were so busy getting elected (or not) they just forgot about it.

It also seems odd that the Metropolitan Police have not carried out any investigations into financial irregularities at Raines House.

Maybe nobody told them either.


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