The Canadian Revenue Agency revoked the tax-exempt status of three Jewish nonprofits last week on the grounds of poor bookkeeping.

The three organizations — the Canadian Foundation for Masorti Judaism, a philanthropic arm of Canada’s Conservative Jewish community; Mazel Charity Fund, a private foundation that gives to Jewish causes; and Herut Canada Charitable Foundation, a right-wing Zionist group. These three groups join a growing list of nonprofits whose tax-exempt status has been stripped recently.

Sources familiar with the matter told eJewishPhilanthropy that the Canadian tax authority is believed to be auditing other Jewish organizations as well and that while the groups may indeed have fallen afoul of Canadian tax law, the decision to investigate them in the first place appears to be ideologically motivated.  

In the letters sent to all three organizations, the CRA said that audits of the groups found that they were not maintaining proper “books and records.” In the case of the Masorti foundation, the CRA also said that the organization was giving grants to “inadequate donees,” and “providing non-incidental private benefits,” all of which justified the revocation.  

Last August, the CRA stripped the tax-exempt status of the Jewish National Fund of Canada and the Ne’eman Foundation. 

In September, JNF-Canada launched a “Friends of” organization to support its work while it works to restore its charitable status.

According to Rabbi Sean Gorman, the executive director of Mercaz and the Canadian Foundation for Masorti Judaism, during its initial audit, the organization was not warned of any issues with the recipients of its grants. “Do not put a stumbling block before the blind,” he told eJewishPhilanthropy. “If our donees were problematic in 2022 when they started auditing our account again, they were probably problematic in 2019. The laws on that did not change, right?”

According to Gorman, Masorti donates primarily to synagogues and Conservative movement initiatives in Israel. In the most recent audit, the CSA listed the Masorti Movement, the Hannaton Education Center and six Israeli Masorti synagogues as “non-qualified donees.” 

“There should come a point where people at a level, higher than my own, should be starting to ask when coincidence becomes a trend. When coincidence becomes trend, there should be a more organized response,” Gorman said. “I’m not in the camp of ‘Something’s fishy here’

Not at all, but I very much understand the concerns of those who are in that camp, right?”