Ombudsman penalizes Likud, Labor for irregularities in their financial reports for 2024

State Comptroller Matanyahu Englman’s office released a report Tuesday on the financial obligations and reports of Israel’s political parties in 2024, finding wrongdoing on the part of the ruling Likud party and the opposition’s Labor.

The ombudsman decided to penalize the two parties by deducting sums that would otherwise have come to them as regular state funding given to Knesset factions.

Likud was docked  NIS 150,000 ($53,000) for receiving party dues that didn’t meet the legal requirements, and for failing to provide proof of payment for extra payments and bonuses given to various administrative officials based on unwritten agreements.

The report found that there was insufficient oversight over membership fees in a way that failed to guarantee the authentication of each member’s identity and payment method. Over 40 percent of credit cards and bank accounts used to pay these dues — some 16,000 credit cards and 13,000 bank accounts — were each used for the membership fees of more than one person, and in about a quarter of these cases, the members had different family names and apparently weren’t from the same household.

The report said this raised the suspicion that membership fees are routinely paid for by others, a situation it characterized as “grave” since it could skew the electoral slate picked in the Likud primaries.

It said Likud had pledged to fix both issues.

Meanwhile, Labor — a party that is set to be folded into the new Democrats party ahead of the upcoming election — was fined NIS 75,000 ($27,000) for receiving a prohibited loan from a corporation using a party-owned enterprise, violating the law stipulating that parties can only receive loans from the state treasury or from a banking corporation to acquire rights in real estate.

No irregularities were found in the financial reports of the other parties. No party was found to have illegally expended money.

However, the report found that 10 factions — most of the factions currently represented in the parliament — have accumulated deficits with a combined total of NIS 81.2 million ($29 million), a figure described as “worrying.” About half of that sum is owed by Likud.

The report found that seven parties that aren’t currently represented in the Knesset — including Balad, Jewish Home and Meretz — are still in debt after previously taking loans and receiving advance payments from the state. These parties owe a combined sum of NIS 43.8 million ($15.5 million).

The largest sums are owed by Meretz — another party set to be included in the new Democrats alliance — and by Tzalash, a long-defunct faction used by Naftali Bennett as the structural basis for his New Right and Yamina parties.

Two other defunct parties — Kulanu and Telem — ended their Knesset terms in 2021 with surplus funds totaling NIS 3.7 million ($1.3 million) that haven’t been returned to the state treasury as required, the report noted.

Englman said in a statement that the parties’ failure to pay their debts “doesn’t reconcile” with their public duties.

“I call on the Knesset to pay attention to this matter, to ensure the debt is paid to the state treasury and to prevent such cases from occurring in the future,” he added.