Charity Heads Ordered to Repay $500,000 in Cancer Fund Misappropriation
Translated & summarized from Walla by baba
Two Israeli charity heads and board members must personally repay nearly 1.85 million shekels in funds originally designated for children with cancer. The money was improperly transferred to a different organization without court approval, and investigations revealed severe operational deficiencies and misuse of funds. The court emphasized that volunteer board members are personally responsible for overseeing charity finances, rejecting claims of ignorance or volunteer status as a defense. The ruling aims to protect public donations and reinforce accountability within the non-profit sector.
The story in 6 lines · by baba
- Charity leaders must repay 1.85 million shekels of cancer-focused donations due to improper transfer and use.
- The funds were moved to a different charity without court approval, bypassing oversight mechanisms.
- The court ruled that volunteer board members are personally responsible for overseeing charity funds.
- The CEO must also return over 290,000 shekels in salary and rent paid unlawfully.
- Misleading reports and forged documents were submitted to authorities during the affair.
- Dissolution orders were issued for both "Keren LeChaim" and "Keren LeChaim for Children and Youth" in 2024.
The board members and CEO of two Israeli charities, "Keren LeChaim" and "Keren LeChaim for Children and Youth," have been personally ordered to return approximately 1.85 million shekels (about $500,000) in donated funds intended for children with cancer. The case began with a specific donation of about 1.9 million shekels from the estate of Helen Hatav, approved by the Family Court in 2019 to aid young cancer patients through "Keren LeChaim."
However, the funds were transferred to a different organization, "Keren LeChaim for Children and Youth," without court approval for the change in recipient or the purpose of the funds. An in-depth review by the Ministry of Justice's Corporations Authority revealed severe operational deficiencies in the older charity, which were not rectified despite professional guidance. Consequently, the Registrar of Associations initiated proceedings to dissolve both organizations.
The Haifa District Court, presided over by Senior Judge Ron Sokol, accepted the request of the liquidator, Adv. Ron Kahana, and ruled that the designated donation funds were unlawfully transferred to another association, bypassing oversight mechanisms, altering the donation's purpose, and using the money inappropriately. The court emphasized that even volunteer board members bear personal responsibility for overseeing the charity's funds.
In addition to the 1.85 million shekel repayment, the charity's CEO, Adv. Galit Shemesh, was personally ordered to return 180,390 shekels in salary and 112,110 shekels in rent paid to her unlawfully, constituting a severe conflict of interest. These amounts will be deducted from the joint liability. The respondents were also ordered to pay 20,000 shekels in legal costs.
Further findings during the liquidation revealed serious misuse of the donated funds. The court determined that the transfer of funds and change in purpose were intended to allow officials to evade oversight and restrictions imposed on the original charity. Misleading reports were submitted to the Registrar of Associations, and forged documents were used. Some funds were used for improper payments, including brokerage fees and salaries, while evidence for alleged renovation costs for a risk-youth hostel was insufficient. In 2024, dissolution orders were issued for both charities following these severe findings.
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