£2.35m returned to charities following NCA probe: a tale of charity fund mismanagement unveiled
By Law News
In a case highlighting the importance of stringent oversight in the charitable sector, retired Rabbi Barry Marcus MBE has agreed to return £2,350,000 to two charities after an investigation by the National Crime Agency (NCA) revealed mismanagement of funds
The funds, which were intended for charitable causes, had instead been held in personal accounts for several years.
Barry Marcus, 74, former Rabbi at the Central London Synagogue and recipient of an MBE for his work on Holocaust Education, found himself under scrutiny following an investigation by the NCA. The agency uncovered that Marcus had failed to distribute the funds received from Dalaid and The Schwarzschild Foundation, two organisations dedicated to relieving poverty and advancing education within the Jewish community.
The NCA's inquiry, which commenced in October 2022, revealed that Marcus had received substantial sums of money from the charities between January and September of the same year. Despite claiming to have distributed a significant portion of the funds, Marcus was unable to provide adequate documentation to support his assertions. Subsequently, the NCA applied for Account Freezing Orders over the frozen funds, totalling £1,183,072, held in Marcus' accounts.
After protracted investigations and legal proceedings, Marcus formally agreed to return over £2 million to the charities, nearly doubling the amount originally identified and frozen by the NCA. The Westminster Magistrates’ Court, in a ruling on 12 March 2024, allowed the frozen funds to be returned to the two charities.
The implications of this case extend beyond financial recovery. In June 2023, the Charity Commission initiated Statutory Inquiries into both charities, focusing on concerns regarding their operation and governance by trustees. These inquiries are ongoing, with the Charity Commission taking measures to ensure the returned funds are appropriately utilised.
Tim Quarrelle, NCA Branch Commander, Asset Denial, expressed satisfaction at the outcome, emphasising the dedication of NCA officers in pursuing every lead to secure the return of misappropriated funds. He also acknowledged the invaluable collaboration with the Charity Commission, which has been instrumental in investigating issues surrounding the affected charities.
The case serves as a stark reminder of the vital role of regulatory bodies in safeguarding charitable assets and ensuring accountability within the sector. It underscores the need for robust oversight mechanisms to prevent instances of financial mismanagement and uphold the integrity of charitable endeavours.