The trustees of an Orthodox charity have been issued with an official warning by the Charity Commission after it found evidence of “poor financial management and governance”.

The regulator opened an inquiry into Salford-based Chesed Leyisruel Trust in 2017 after it failed to submit accounts on time for a third successive year.

Trustees failed to ensure they could effectively manage conflicts of interest, to hold meetings according to the charity’s governing document and to obtain professional advice when making investment decisions, the commission said.

The trust had taken two-interest free loans to buy properties for investment, “despite the fact that the charity did not have an investment policy”, the inquiry found. The trustees had only obtained “informal advice” about the loans.

A possible conflict of interest remains in that two of the trustees, Eli and Nechamah Goldberg, are related. A third trustee, Shoshana Reizel Wosner, who was also related to them, resigned last autumn.

The commission said it would continue to monitor the progress of the charity, which has been given six months to put its house in order.

Amy Spiller, head of the commission’s investigations team, said the case “serves as a reminder of the importance of good governance and careful stewardship of charitable funds. The public rightly hold charities to high standards, which these trustees have unfortunately failed to live up to.”

The trustees, she added, had “demonstrated a willingness to address our concerns”.

According to its latest accounts for 2018, the trust spent around £463,000 and had an income of £461,000 that year, leaving assets of around £82,000.