The former trustees of a Jewish charity have been criticised by the Charity Commission for failing to prove that £550,000 sent abroad was for charitable purposes.

The payments abroad over a four-year period from 2018 were made by former trustees at Jewish education charity Keren Shmuel.

The regulator’s investigation into the charity’s finances “sought to understand whether the former trustees were able to fully account for this sum”,

But while they "provided an explanation as to how the funds have been applied, there was insufficient evidence provided to show and explain how the majority of the charity’s funds were expended in furtherance of the purpose for which they were sent overseas”, the Commission found.

Its probe concluded that “the conduct of the former trustees fell below the standard” expected by the Commission, which ruled there had been misconduct and/or mismanagement at the charity.

Failings at the charity related to “the former trustees’ financial management, to follow basic requirements in the governing document and in the overall governance of the charity”.

“This includes evidence of poor management of, and lack of records of the charity’s expenditure overseas. As a result, the Inquiry found that the former trustees had not complied with or fulfilled their duties as trustees under charity law,” added the regulator.

Trustees resignations

The trustees involved have since left their roles. This includes the former chair who in “recognising the failures” told the Commission that “it would be in the charity’s best interests for new trustees to be appointed”.

The remaining trustees also resigned and new trustees were appointed between July and November last year.

The Charity Commission first became involved with the charity in 2017 after it was subject to its double defaulters class inquiry for failing to submit their accounts on time, for the years ending December 2014 and 2015.

It was removed from the enquiry that year after filing its outstanding accounts.

But it then went on to file late accounts again, for 2019 and 2021. Accounts were once again up to date by 2023, however the Commission opened a statutory inquiry due to repeated failures around submitting its records.

“Trustees must ensure that their charity has adequate financial controls in place, it is important that the financial activities of charities are properly recorded, and their financial governance is transparent,” said the regulator.

“Charities are accountable to their donors, beneficiaries and the public. Donors to charity are entitled to have confidence that their money is going to legitimate causes and reaches the places that it is intended to, this is key to ensuring public trust and confidence in charities.

“In this case there was no clear audit trail of cash donations from donor to bank, or to expenditure.”

---