Probe into Jewish charity over ‘unexplained £1.7m loans’

The charities watchdog has opened a legal probe into a Manchester Jewish charity over alleged unexplained loans of £1.7m to those connected to the trustees.

The Charity Commission opened a statutory inquiry on Wednesday into the MB Foundation, also known as the Mossad Horav Aryeh Halevy, over “serious financial and governance concerns.”

The foundation, which operates in Bury and Israel, states its aim is to give grants to relieve sickness and poverty.

The charity was previously investigated by the Commission in a class inquiry, after failing to submit annual accounts for the 2014 and 2015 financial years.

The watchdog said that “subsequent scrutiny” of the accounts raised concern about the trustees’ handling of conflicts of interest.

It said that the charity carried out several transactions with companies and individuals linked to the trustees, who are brothers, or their relatives – including four loans to a linked company of over £1.7m.

“The trustees have so far failed to provide the Commission with any formal documentation in relation to these loans,” said the Commission. 

“Furthermore, the trustees did not provide information to demonstrate they had adequately identified or managed conflicts of interest.”

The probe will investigate the trustees’ decision making around loans and investments and whether there has been any unauthorised or indirect private benefit, among other things.