Ministry: KKL-JNF gave millions to political orgs, promoted staff based on politics

The Jewish National Fund (KKL-JNF) diverted millions of shekels to politically affiliated companies and promoted employees to senior positions based on their political views, in a breach of its own policies.

According to a new report by the Justice Ministry, cited by Hebrew-language media, KKL-JNF transferred millions of shekels to political bodies and private entities in 2014-2017, mostly under former chairman Danny Atar and in direct abrogation of the organization’s responsibilities.

The report’s author, accountant Itzik Slobodiansky, said that the implications of his findings were so serious that KKL-JNF would need to be dissolved.

However, Attorney Karen Schwartz from the Justice Ministry’s Corporations Authority, which commissioned the report, has avoided taking drastic action against the organization at this point, noting KKL-JNF’s willingness to cooperate with the Justice Ministry and address the issues at hand.

The report lists various political parties and organizations that received millions from KKL-JNF for unclear reasons that do not correspond with KKL-JNF’s objectives. These include World Likud, the right-wing Likud party’s wing for global communication; the ultra-Orthodox Shas party; and the Yedioth Ahronoth publishing group, among others.

World Likud was given NIS 2.44 million ($750,000 at current rates) by KKL-JNF in 2017, the report noted, making up more than half of its total revenue that year. Most of the money was used to pay the salary of the organization’s CEO and could not have been used to promote KKL-JNF’s official agenda, according to the report.

NIS 560,000 (some $170,000) was provided to the Shas party, which was primarily concerned with having its representatives elected to the Zionist Congress at the time, the report said, noting that this, too, was inconsistent with KKL-JNF’s objectives.

Yedioth Ahronoth Group received at least NIS 7 million ($2.16 million) from KKl-JNF between 2014 and 2017 through various collaborations and joint projects, with no clear criteria and in unusually high amounts, the report determined.

“KKL-JNF spent huge amounts, in violation of its procedures, without insisting on its rights and doing so without promoting its goals,” the report read.

The report also accuses KKL-JNF of electing its board and other senior positions through a mechanism “that includes political characteristics that led to deeply rooted problematic norms in the company.”

KKL-JNF responded by saying that most of the inconsistencies brought up in the report relate to actions taken by the previous board of directors, and that the organization will “thoroughly study the report and reach the necessary conclusions.”

KKL-JNF was founded in 1901 with the purpose of purchasing lands in Ottoman Palestine for Jewish settlement. Following the establishment of the State of Israel in 1948, the nonprofit redefined its objective as the reclamation of lands for the Jewish people, becoming increasingly more involved in the West Bank following the Six Day War.

Following the report’s publication, KKL-JNF expressed willingness to begin a comprehensive reviewing process of its operations to be led by an external reviewer appointed by the Justice Ministry.

“The proper conduct of foundations and public-benefit companies, as public bodies meant to serve the public, is of the utmost importance for a firm civic sector and the resilience of the Israeli civil society. Oversight is meant to serve this interest,” Schwartz said.

“Regarding KKL-JNF, which holds a long history of public service, both in Israel and abroad, and whose huge influence is felt in the Israeli public sphere, the public interest in a process of oversight is tenfold,” she added.

Despite the report’s harsh findings, Schwartz commended KKL-JNF for allowing “a productive discussion that has already begun addressing certain deficiencies and will address additional ones found in the company that will improve its overall conduct.”

KKL-JNF has been criticized over the years for its lack of transparency, despite becoming a public-benefit nonprofit corporation in 2014 with the clear intention of serving the Israeli public.

A Calcalist report from January found that KKL-JNF had stopped uploading protocols from board meetings to its website.

An ombudsman report from 2017 found that KKL-JNF had given hundreds of millions of shekels to projects without proper oversight and according to “personal preferences.”