By James Simons-
The Charity Commission has removed two trustees from a Jewish Charity Chabad Uk and 7 associated charities, including the manager of the charities after he was convicted of laundering money involving £9m through the charities from the sale of counterfeit medication and supplying false information to the Commission.
The regulator worked closely with the Metropolitan Police throughout its investigation into the charities that were registered to advance the Orthodox Jewish faith and relieve poverty. Information supplied by the inquiry allowed the manager to be convicted of an offence under section 60 of the Charities Act for providing false or misleading information to the Commission.
Over £9 million passed through the charities’ bank accounts between January 2012 and May 2014, however most of the charities’ annual returns to the Commission declared nil income or expenditure. The investigation also discovered that more than £60,000 was paid out of the charities’ bank accounts to a trustee between 2007 and 2015.
The trustees failed to meet their statutory reporting requirements. The Charity Commission concluded the failings to be a clear breach of the trustees’ duties and amounted to serious mismanagement and/or misconduct in the administration of the charities.
A number of the charities’ bank accounts are currently restrained by a court order under the Proceeds of Crime Act. The Commission is considering its options in relation to the recovery of funds and will ensure that, where possible, any charitable donations recovered are applied in accordance with the charitable objects to which they were initially given.