A charity housing 350 homeless young people, which is at financial risk due to poor management, says it is working to find a solution to its problems.

Forest YMCA, based in Forest Road, Walthamstow, was served with a regulatory notice by the Housing Communities Agency (HCA), months after the departure of the charity’s chief executive, Timothy Pain.

Risks taken by bosses have left the charity is forced to rely on an overdraft and short term loans to cover existing liabilities.

This has placed the next phase of the MyPad housing scheme, which involves young people being homed in converted shipping containers, is at risk.

Mr Pain, who stepped down due to ill health two months ago, spearheaded a number of initiatives, including the takeover the city farm in Skeltons Lane, Leyton at a cost of £800 per day.

A gym at the charity’s headquarters is also in the middle of being refurbished.

In a statement, a spokeswoman for Forest YMCA said: “As a provider of social housing we take our duty to comply with the regulatory standards very seriously.

“It was Forest YMCA who brought this situation to the attention of the regulators, and we are working with them fully to resolve this issue.”