Scottish regulators criticize past management of a charity founded by king but find no misconduct

LONDON — Scottish regulators have criticized the past management of a charity founded by King Charles III following an investigation triggered by media reports that a Saudi billionaire sought to secure a knighthood and U.K. citizenship in return for donations.

The Scottish charity regulator, known as the OSCR, found in a report released Tuesday that the former trustees of the Scotland-based King's Foundation — previously known as the Prince's Foundation — didn't properly scrutinize a number of transactions and failed to adequately oversee the charity's former chief executive.

''The inquiry found the historical governance of the charity had not always been up to the standard required,'' the regulator found. But it said the inquiry did not find evidence of misconduct by any of the former or current trustees.

The investigation followed a series of stories about the charity published by the Times of London in 2021. The newspaper reported that Michael Fawcett, a long-time aide to Charles who was then CEO of the foundation, had offered to help secure support for a Saudi citizen to receive a knighthood and British citizenship in return for donations of as much as 1.5 million pounds ($2 million). Fawcett resigned in November 2021.

London's Metropolitan Police Service opened an investigation into the newspaper's allegations in 2022. After interviewing a number of witnesses and reviewing more than 200 documents, police said they would take no action in the case.

While Scottish regulators didn't discuss the cash-for-honors scandal, they did refer to a report on donations made by the Mahfouz Foundation, a charity founded by Mohammad Marei Mubarak Bin Mahfouz, the Saudi billionaire at the heart of the allegations.

Scottish regulators referred to an earlier investigation by their counterparts in England, which last year found that trustees of the Mahfouz Foundation had allowed it to be used for the receipt and expenditure of funds from the billionaire ''for the furtherance of his personal interests.''

English regulators last year barred a former trustee of the Mahfouz Foundation from serving as a trustee of any charity for 12 years. The Mahfouz Foundation has ceased to operate.

Charles founded the Prince's Foundation in 1990 to support education, sustainability and traditional arts and crafts. The charity changed its name after Charles became king in 2022.

Scottish regulators criticized Fawcett's handling of several transactions, including allowing the insurance to lapse on valuable artwork that had been loaned to the charity.

''In relation to the charity's former CEO, the inquiry found that some of his actions resulted in the charity being exposed to substantial risk,'' the regulator said. ''It was unacceptable that he did not brief the charity trustees on some of these serious issues as soon as they arose.''

Nonetheless, given all the information, the regulator said it ''does not consider that there was misconduct on the part of the former CEO.''