“Unscrupulous Pattern of Dishonesty” at 8 Charities Used to Launder Proceeds of Crime

Individuals disqualified following regulator’s inquiry into Chabad UK and 7 linked charities


Chabad UK is a separate charity to Chabad Lubavitch UK (registered charity 227638); the class inquiry is not connected to it or any other Chabad organisations.

The Charity Commission is considering its options around the recovery of charity funds as it reports on its inquiry into Chabad UK and 7 linked charities. Two trustees have been removed and disqualified from their positions, and the manager of the charities automatically disqualified, after he was convicted of laundering money 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.


The inquiry found that:

  • 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.

  • Over £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.


These failings were 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.


Amy Spiller, Head of Investigations Team at the Charity Commission, said:

This case involved an unscrupulous pattern of dishonesty that has no place in charity. Charity represents the best of human characteristics – that’s why the behaviour of those involved in charities matter.These charities were clearly misused for personal gain, and I am pleased that we have been able to work closely with the police to ensure that those responsible have been brought to justice.

The report of the inquiry is available on GOV.UK.


Ends.


Notes to Editors:

The charities involved in the inquiry were: Chabad UK (registered charity 1118547), Havenpoint Limited (291213), Pikuach Nefesh Limited (1115619), Worldwide Hatzala Ltd (1115623), Ozer Dalim Limited (1118537), Mamosh Worldwide Limited (1118730), Or Simcha (1119522) and Havenpoint Worldwide (1122120).The charities remain registered as the Commission is still considering its options in relation to the recovery of funds; the Commission will consider their removal once this process has concluded.


Chabad UK is a separate charity to Chabad Lubavitch UK (registered charity 227638); the class inquiry is not connected to it or any other Chabad organisations.


The Commission is the independent regulator of charities in England and Wales. To find out more about our work read the about us page on GOV.UK.

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