Photo: Gil Yohanan
Joseph Shapira, State Comptroller
Photo: Gil Yohanan

State Comptroller issues scathing report on KKL

In an audit conducted by Joseph Shapira, the State Comptroller alleges 'serious, deep and thorough deficiencies' in the management of the organization; submits findings to Attorney General for possible criminal investigation.

Following the first audit of KKL, State Comptroller Joseph Shapira noted that he found "serious, deep and thorough deficiencies" in the organization.



Shapira went on to detail instances of projects worth hundreds of millions of shekels that were handled with no clear priorities, extensive financial irregularities and obvious instances of conflicts of interest between KKL board members and politicians.


State Comptroller Joseph Shapira
State Comptroller Joseph Shapira


It is also possible that criminal charges will be brought against those involved as the comptroller submitted his findings to the Attorney General Avichai Mandelblit.


The audit primarily dealt with the core of KKL's activities—the Land Development Authority (LDA). The main deficiencies covered in the report deal with KKL projects funded through the LDA, which amounted to NIS 1 billion and were conducted without clear priorities and proper administrative oversight.


The comptroller remarked that the few decision makers who were chosen due to their political qualifications—among them former KKL Chairman Efi Stenzler and former Co-Chairman Eli Afflalo—were the ones who chose what projects KKL would fund and carry out, and under what conditions, as part of the "supreme project committee," whose decisions were never recorded.


Eli Afflalo (right) and Efi Stenzler (Photo: Flash90) (Flash90)
Eli Afflalo (right) and Efi Stenzler (Photo: Flash90)


The comptroller discovered that the decisions on the fates of projects worth hundreds of millions of shekels were made with no clear standards and considerations for alternatives. Oftentimes, these decisions were made by committee members who also held political positions in local authorities, constituting a conflict of interest.


For example, during a project in Acre, Zeev Neuman, who was a board member for KKL responsible for fundraising, was also the acting mayor of Acre. Neuman used this position to secure a flight to $7,378 flight to Canada as part of his position as being in charge of fundraising, where he set up an event to raise money for a project in Acre.


In terms of disorganization and no clear set of priorities, Shapira noted that there were several instances in which "centralized decision making was nonexistent, missing documents, and strong influence of outside parties."


The iconic KKL tin donation box (Photo: Herzl Yosef) (Photo: Herzl Yosef)
The iconic KKL tin donation box (Photo: Herzl Yosef)


For example, during a nature project in Afula, the northern director of the LDA sent the city and the Drainage Authority—the entity that would be in charge of the project—a signed KKL financial commitment worth NIS 3 million, despite the fact that he did not have the authority to do so.


Shapira further emphasized that there was a lack of coordination with the government, who Shapira said "abandoned their right and duty to the public" to influence priorities within KKL, especially when it comes to the development of land, which is primarily owned by the state.


In response, former KKL Chairman Efi Stenzler said, "I am proud of the momentum I brought to KKL in the 10 years I was chairman and am glad the State Comptroller submitted an audit report that eliminates all the baseless statements made by interest groups who influenced the atmosphere against KKL. The comptroller finishes his report with appreciative words for the workers of KKL and rightly so. They have done and are doing everything to fulfill the mission and vision of the Jewish people."


Trees planted by the KKL (Photo: Ohad Zwigenberg) (Photo: Ohad Zweigenberg)
Trees planted by the KKL (Photo: Ohad Zwigenberg)


Eli Afflalo's attorney, Naama Zer Kavod, said in response, "Mr. Afflalo welcomes the report. As Co-Chair of KKL, Afflalo introduced the organization's social policies which were aimed at reducing disparities between the center and the periphery. Additionally during Mr. Afflalo's tenure in office, the organization adopted the rules requiring KKL to be listed as a public benefit. There is no doubt that everything was done in good faith and with the Zionist mission at heart."


KKL itself responded to the report, saying, "KKL thanks the State Comptroller for his work and believes his critique is an essential tool for efficiently and improvement. Since receiving the interim report, we are working with haste to make improvements and have so far made abundant changes in the organization’s culture to increase transparency, sharpness and governance.


"We believe that criticism is a central tool in the improvement and management of every organization, therefore KKL once again calls for the Prime Minister and the Israeli government to adopt the agreement that was signed between the organization and the government, and with the blessing of the State Comptroller, and allow for the State Comptroller’s Report to include the organization, a step that will increase the organization’s transparency and will assist in gaining the public’s trust in the organization’s activity."


פרסום ראשון: 01.18.17, 23:57
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