The Charity Commission, the independent regulator of charities in England and Wales, has opened a statutory inquiry into Chessed L’Yisroel Ltd, registered charity number 1075893. The inquiry was opened on 21 July 2016.
The charity has objects to advance religion in accordance with the Orthodox Jewish faith and to relieve poverty.
The commission announced on 27 June 2014 that it was adding Chessed L’Yisroel to its class inquiry into charities in default of their statutory reporting obligations. The charity at that time had not filed annual returns, reports and accounts with the commission by the due dates for 4 years. Reports and accounts submitted to the commission since then as part of the double defaulter class inquiry have raised significant regulatory concerns.
The annual accounts initially submitted for the financial periods ending 30 September 2009 and 31 December 2010 contained no independent audit reports, which was in breach of the Charities Act given the charity’s income.
Analysis of the charity’s bank statements by the commission highlighted a significant discrepancy with the financial activity declared in its 2011 accounts, which reported an income of approximately £140,000 and expenditure of £139,000. The charity has since resubmitted a conflicting set of accounts for 2011 which show an income of approximately £632,000 and expenditure of £724,000. The resubmitted accounts for 2011 contains a qualified audit opinion, which prompts concerns about the charity’s financial affairs.
In addition, in 2011, the charity failed to meet repayment obligations to a lender, resulting in the repossession of the charity’s properties and a loss to the charity of £256,084. That same year, the charity took out a loan for £131,489, which has not been repaid. The charity has failed to adequately explain why it did not make its repayment obligations or what it did with the money it borrowed.
The inquiry will examine:
- the reliability and accuracy of the charity’s financial reporting
- the adequacy of the charity’s financial management controls and whether this has resulted in a substantial level of charity funds being lost, misappropriated or misapplied
It is the commission’s policy, after it has concluded an inquiry, to publish a report detailing what issues the inquiry looked at, what actions were undertaken as part of the inquiry and what the outcomes were. Reports of previous inquiries by the commission are available on GOV.UK.
The charity’s details can be viewed on the commission’s online charity search tool.
Notes to editors
- The Charity Commission is the independent regulator of charities in England and Wales. To find out more about our work, see our annual report.
- Search for charities on our online register.
- Section 46 of the Charities Act 2011 gives the commission the power to institute inquiries. The opening of an inquiry gives the commission access to a range of investigative, protective and remedial legal powers.
- The commission’s decision to announce the opening of a statutory inquiry is based on whether it is in the public interest to do so and with consideration of our objective to increase public trust and confidence in charities.