A DUDLEY school academy trust which spent up to £100k on companies which its CEO had links with and £38k leasing him a non-existent car has been found to have misused public money in a damning report.

A government investigation into the Learning Link Multi-Academy Trust, which runs four primary schools in Dudley, revealed it spent hundreds of thousands of pounds of taxpayers' money without following the correct procedures and "misused public funds."

Learning Link, which is responsible for Sledmere, Kates Hill, Netherbrook and Dudley Wood primary schools, also doubled the hours and pay of its then chief executive Paul Harrison without following due process.

The investigation, carried out by the Education and Skills Funding Agency (ESFA), was prompted by an allegation made in 2019 of payments being made to the CEO Paul Harrison.

The subsequent report found that the Learning Link trust board, chair and CEO made "significant failings" and that the trust board had not held executive leaders to account.

It revealed tens of thousands of pounds (up to £100k) had been spent with five companies, four of which Mr Harrison had a direct personal interest, the fifth was run by the wife of one of the organisation's trustees.

Mr Harrison received £38,250 for car leasing, despite there being no evidence that a car was ever leased.

The report states: "The ESFA deems the £38,250 paid for the car leasing allowance as irregular and a misuse of public funds."

It also states that Mr Harrison's "salary and working hours increased from 2.5 to 4 and then 5 days per week, without board approval."

IT goes on: "Whilst receiving a salary for 4 days a week, the CEO's company received payment for an additional day of consultancy.

"This related party transaction was not formally approved by the trust board and breached the trust's financial regulations."

It also states that "the trust was unable to demonstrate that decisions benefitting the CEO were made independently of the CEO and that the inherent conflicts of interest had been adequately managed."

Mr Harrison admitted that he did not use the money to lease a car, saying he considered it to be an "uplift on his salary."

The report found that the trust had misused public money and failed to manage conflicts of interest.

The investigation also identified £292,989 that was spent "that had no evidence of procurement, inadequately evidenced / no board approval and some unmanaged conflicts of interest."

The report adds: "These transactions breached the trust’s financial regulations" and "are deemed contentious and improper."

Documents state the trust had a deficit of £394k at the end of August 2019 and when investigators visited the CEO at Sledmere Primary Mr Harrison said he said he was unable to access any material on his laptop citing IT problems at the school to do with internet provision.

The trust, which was set up in 2017, was issued with a financial notice to improve on 2 January 2020.

In July 2020 the schools commissioner for the West Midlands Andrew Warren issued termination notices to the four schools in the trust, requiring action.

The report states: "On 13 October 2020 the RSC WM issued a termination notice to members and trustees of Learning Link Multi Academy Trust, based on a failure to take sufficient action to address concerns."

It now has a new board of trustees and leadership team, and is in the process of transferring the schools to new trusts.