UKLFI: Supporting Israel with legal skills

Imprisoned Finance Directors ignored by PwC Auditors

PwC Palestine audited a Palestinian NGO while two of its finance directors were taken into administrative detention for their alleged connections to a designated terrorist group.

PwC Palestine is known to have audited the Union of Agricultural Work Committees (UAWC) for the period 2014 to 2018.  During this time, not one, but two of its finance directors were taken into administrative detention.

Samer Mina Salim Arbid, Financial Director of UAWC in around 2015-2016, and recently arrested for commanding a PLFP terror cell that carried out a bomb attack which killed 17-year old Rina Shnerb, and injured her family,  was in  administrative detention from December 2015 until March 2016.

Abdul Razaq Farraj, finance director of UAWC and employee for the past 30 years, was detained and imprisoned twice while PwC was auditor – from February to August 2014 and from May 2017 to July 2018.  Farraj is a convicted member of the Popular Front for the Liberation of Palestine (PFLP) terrorist group.

The UAWC was founded by members of the PFLP and was listed as its official “affiliate”, by Fatah[1]. The Israeli Internal Security Agency (Shin Bet) has confirmed the connection of UAWC to the PFLP and it was also identified by USAID as the PFLP’s “agricultural arm.”

Despite this, and perhaps relying on the audits by a member of one of the “Big 4” international accountancy networks, the EU, European governments and major NGOs have donated millions of euros to UAWC. When received by UAWC these sums likely came under the control of its Finance Director.

PwC presumably works closely with the Director of Finance of the organisation it audits. Despite this, and all UAWC’s other links to the PFLP,  it appears that PwC Palestine ignored these alleged terrorist connections, in breach of the OECD guidelines for multinational enterprises on responsible business conduct.

UK Lawyers for Israel (UKLFI) has been investigating the auditing of NGOs with alleged terrorist links for some time.  In May 2018 we pointed out that a PwC firm was the auditor for UAWC.

In June 2019 UKLFI reported PwC to the UK National Contact Point for suspected breaches of the OECD Guidelines for Multinational Enterprises in relation to its auditing of UAWC and is awaiting an outcome of the complaint.

Samer Mina Salim Arbid

Arbid was Financial Director of the UAWC[2]  in around 2015 to 2016,  and had also been an accountant at Addameer[3], the prisoners’ rights organisation.

According to the Shin Bet, Arbid commanded a PLFP terror cell that carried out a bomb attack which killed 17-year old Rina Shnerb, and injured her father and brother on 23 August 2019, while they were on a nature trail.  Arbid led the terrorist cell, prepared the bomb and set it off the moment he saw the Shnerb family reach the spring.[4]

A Jerusalem Post article[5]  published on 5 October 2019 stated that Arbid is “one of the PFLP’s officials in Ramallah and was previously arrested for involvement in terrorist activities during the Second Intifada under the direct command of the PFLP leadership, preparing explosive devices and committing terrorist attacks.”

Arbid was described by Amnesty International as “a member of the PFLP”. [6]  An article dated 14 March 2016 on the Samidoun website[7]  describes Arbid as financial director of the UAWC, and explains that he was arrested in December 2015 and given an administrative detention of 3 months, which was renewed for a further 3 months in March 2016. This was during the period that PwC Palestine was the auditor of UAWC.

Samidoun describes Arbid’s history of administrative detentions – he was held from 2003-2006, 2007-2008 and again in October 2013 when he was arrested and put in administrative detention for an initial period of four months.

The 2016 Samidoun article states that Arbid was previously the accountant for Addameer, the prisoner support and human rights association.    A 2013 Electronic Intifada[8] article also identified Arbid as an accountant at Addameer.  Addameer’s own website lists Arbid as its accountant as recently as May 2018.

Abdul Razaq Farraj

Farraj, who was convicted and spent 6 years in jail for being a PFLP member, as well as several other periods in jail on administrative detention, is thought to be the current Finance Director of UAWC.

Farraj was convicted of membership of the PFLP[9] for which he served a six year prison sentence from 1985 to 1991.

Since his release from prison in 1991, he has been arrested six times, and each time placed under administrative detention. According to Amnesty International, he has been employed by UAWC  since around 1989.[10]

An Indian publication entitled Frontline, dated 11 July 2014[11], reported that Farraj was held in administrative detention in 1994-96, 2002-06, 2009, 2011-12 and from 25 February 2014 until the date of the article in July 2014.  He was due to be released on August 24 2014.

Amnesty International’s newsletter dated 13 April 2018[12] records that Farraj was arrested on 21 May 2017 and issued with a four-month administrative detention order, which should have ended on 20 September 2017 but was renewed several times.  He was eventually released on 17 July 2018, according to Amnesty International’s report dated 16 August 2018, when he returned to work at the UAWC as Finance and Administration Director.

Therefore, while PwC Palestine was auditing UAWC,  Farraj was detained and imprisoned twice – from February to August 2014 and from May 2017 to July 2018.

The terrorist act allegedly carried out by Arbid in August 2019, on behalf of the PFLP underlines the seriousness of the situation.

Caroline Turner, director of UKLFI commented:  “Given the regular arrests of the Finance and Administration Director Farraj, during the time that PwC Palestine was auditing its accounts, and the arrest of the Financial Director Samer Arbid during that period, as well as the other links between UAWC and the PFLP, it seems very strange that the PwC Palestine auditors did not report that anything was amiss with UAWC.”

The UAWC and Addameer are not transparent, and do not themselves publish their sources of funding. However, the organisation NGO Monitor has gathered information from open sources about European funding of these NGOs, which is available here .

UKLFI is very concerned that these donors may have relied on PwC Palestine’s audits when making these donations.  By failing to report the alleged terrorist connections of UAWC’s finance directors and other links between UAWC and the PFLP terrorist organisation, PwC Palestine appears to have fallen below the standards expected of multinational enterprises such as the “Big 4” accountancy networks.

PwC Palestine was approached for comment.