Police have been handed evidence from a year-long investigation into historic financial irregularities allegedly committed by the former chief executive of the Jewish Leadership Council, Jeremy Newmark – but the report failed to reach conclusions on several key allegations against him.
The panel was commissioned, in concert with the Charity Commission in March 2018, after a leaked document was published making startling allegations of financial impropriety against Mr Newmark, who stood down as chief executive in 2013 citing reasons of ill-health.
Thousands of pounds were said to have been improperly spent by Mr Newmark, including on holidays, car leases, and withdrawals of funds, all of which Mr Newmark has robustly denied.
The three-person panel engaged a firm of independent forensic accountants, Crowe UK LLP, to assist with the investigation. It is the unpublished, detailed, material in the Crowe report which has been passed to the police and whose specific charges are unknown. Nevertheless the report says that Crowe believed there to be “potentially questionable expenditure of £111,734”, which “would have warranted further follow up”.
Now unpublished details of the allegations have been sent to fraud investigation police — but the published 23-page report raises more questions than answers.
For his part, Mr Newmark, who was chief executive of the JLC for seven years until 2013, accepts that “some of the criticisms of me are valid”, but adds that he has been subject to “censorship, bullying, and gaslighting” leading up to the report’s release.
He claims that the investigating panel — retired judge Dawn Freedman, Derek Zissman, a former vice-chair of the accountancy group KPMG, and Michael Scott, a lawyer with Charles Russell Speechlys — “have not been able to stand up the core issues against me that were published last year”, despite the expenditure of “a huge amount of time and money”.
One of the three central terms of reference, agreed with the Charity Commission, was “to consider if the JLC suffered a material loss in 2013”. But sources close to the current JLC leadership acknowledged that — because of poor record-keeping and documents missing — it might never be possible to draw such a conclusion.
Simon Johnson, the current chief executive of the JLC, said that the whole panel investigation had been carried out in a spirit of transparency. This extended to an agreement to put Jeremy Newmark’s highly critical statement of response on the JLC’s website, together with the publication of the panel report.
A statement accompanying the final report claimed anyone who had been criticised in the document had been given prior sight in order to provide feedback.
But Mr Newmark said that he had been forced to re-write his 46-section statement of response on the night before publication, because the JLC deemed parts of it “defamatory” and likely to lead to the identification of the whistleblower who had triggered the whole chain of inquiry in the first place.
Mr Newmark claimed that prior to the report being finalised, he had only been asked for feedback on part of the forensic accountant’s report – which itself has not been published. He was later shown only parts of the report under supervision.
Mr Johnson, acknowledging that such allegations could be made against other charities, declared: “We recognise that in the modern world, all charities in receipt of funds from any donors have to be able to withstand the strongest light of scrutiny.
“That is why we have published this report in full. We believe that we are taking steps that will allow those who might have lost confidence in the JLC, to see that their confidence is retained. We have worked hard in the last year to continue to deliver value to the community”.
JLC chairman Jonathan Goldstein said: “The 2013 trustees were let down by Jeremy Newmark. In him they placed their trust in running the organisation. The panel has concluded there were deficiencies in the organisation’s processes in 2012 and 2013. We accept the finding of the panel as well as the recommendations – all of which were are implementing in full or have already implemented.”
The JLC has taken steps to protect the identity of the whistleblower and Goldstein expressed “sincere gratitude” for the whistleblower’s “bravery” and said they had performed “a great service to the charity and the wider community”.
The panel report expresses concern over actions taken by the 2013 trustees, singling out lawyer James Libson and the JLC’s treasurer, Nigel Layton, for criticism.
The report points out that “a professionally qualified trustee has a higher duty of skill and care in matters relevant to that qualification than other trustees”. Mr Libson was “held out” by his company, Mishcon de Reya, as a specialist in employment law, but he told the panel that he was not retained to provide the JLC with employment law advice on either the whistleblower’s report, “or upon any consequent disciplinary action against Jeremy Newmark and he did not do so.”
But the panel also observes that “the actions of the 2013 trustees, following the receipt of the 2013 internal report [the whistleblower material]” were undertaken in good faith.
Nevertheless the report says that with hindsight “the trustees’ proper course of action would have been to open an internal inquiry into other bank accounts and all the years in which Jeremy Newmark had been CEO.”
The 2013 chair of the JLC, Sir Mick Davis, said: “I am pleased that this process has now come to an end, allowing the trustees to concentrate their time and skill on the core opportunities and risks faced by our community. The JLC plays an integral part in ensuring the vibrancy and continuity of the UK Jewish community and the trustees can now be fully focused on that crucial job.”
He added that as the report noted, neither he nor anyone else at the JLC was advised to consider filing a report to the Charity Commission “and, if they had, might have decided that the financial irregularities were not sufficiently material. In future, a notification to the Charity Commission in such circumstances would seem prudent.
With regard to notifying the police at the time, he said, “the trustees did not think it would in the best interests of the JLC”.
A spokesperson for the Charity Commission said: “We have received a copy of the final report of the independent review into the Jewish Leadership Council and are currently considering its findings. Our regulatory compliance case into the charity remains active; we are unable to comment further at this time so as to avoid prejudicing its outcome.”
Mr Newmark said that “perhaps irrationally, I still feel very protective of the JLC.” Though he accepted that he was unlikely ever to work again in the Jewish community, he said that “there are still people today in the community, including at least one former JLC trustee, who call me for advice. So I still feel that connection, and that is why this process is quite difficult for me.”
He concluded: “The fact that this investigation happened was right, but I should not have resigned the way I did”. The matter, he said, should have been directly investigated at the time.
Mr Newmark also said that he was facing two “threats of injunction” from the JLC and one legal action for defamation from the whistleblower.