Chabad Lubavitch UK
Published 2 May 2019
© Crown copyright 2019
This publication is licensed under the terms of the Open Government Licence v3.0 except where otherwise stated. To view this licence, visit nationalarchives.gov.uk/doc/open-government-licence/version/3 or write to the Information Policy Team, The National Archives, Kew, London TW9 4DU, or email: psi@nationalarchives.gov.uk.
Where we have identified any third party copyright information you will need to obtain permission from the copyright holders concerned.
This publication is available at https://www.gov.uk/government/publications/conclusion-of-statutory-inquiry-chabad-lubavitch-uk/chabad-lubavitch-uk
On 31 July 2017 the Charity Commission (‘the Commission’) opened a statutory inquiry (“the inquiry”) into Chabad Lubavitch UK (‘the charity’).
The charity had defaulted in its statutory obligations to meet reporting requirements by failing to file its annual accounting information to the Commission by the due date for several consecutive years. This failure to comply with statutory obligations demonstrated a persistent pattern of behaviour and evidence of mismanagement in the administration of the charity.
The regulatory issues that were addressed in the inquiry were:
- the extent to which the charity was complying with its legal duties in respect of the administration, governance and management of the charity and, in particular, its compliance with legal obligations for the preparation and filing of the charity’s accounting information
- the extent to which the charity had complied with previously issued regulatory guidance.
The inquiry found:
- no evidence of fraud or misappropriation of charity assets
- the charity’s branches were often late in submitting financial information to the Charity’s head office which led to gaps in the accounting records meaning that the accounts, when they were finally prepared were not as accurate as they could have been
- in previous years the budgeting, administration and financial controls procedures were inadequate for a Charity of this size and complexity
-
that the charity had not complied with it its duty to submit accurate accounts in a timely fashion up to the point at which the inquiry was opened. This included the late submission of the accounts for the financial year ending 31 December 2016 which were submitted late during the course of the inquiry. This late submission, being the latest of a series of late filings demonstrated that the charity had not complied with its duty to submit accurate accounts in a timely fashion
- that during the course of the inquiry the trustees had implemented improvements to the governance and reporting processes, resulting in the submission of accounts for the financial year ending 31 December 2017 that were found to be in order
The Commission concluded that there was mismanagement in the administration of the charity prior to the Commission’s intervention because:
- the trustees repeatedly failed to comply with their legal obligations to file accurate accounting information with the Commission within the statutory timeframe
- the co-ordination of the submission of financial information from branches to the centre had not been effectively managed or overseen
During the course of the inquiry, the Commission used its powers under s84 of the Charities Act 2011 to obtain information and copy documents. The Commission ensured that the charity continued to comply with its legal obligations to submit their annual accounts/returns documents.
Approximately £26.8million of charitable income in relation to the financial years 2015, 2016 and 2017 is now accounted for in their financial accounts and published on the Commission’s website.
The trustees co-operated with the inquiry and made a number of necessary improvements to its procedures and processes and as a result the Commission closed its statutory inquiry into the activities of the charity on 18 March 2019.