Archive for the ‘deciet’ Category

Follow Up on Spinka Tax Scheme

January 22, 2008

This is a follow up on this story: Elder Brothers Caught Scheming

The Spinka money trail — and the informant who brought them down

2008-01-11

Amy Klein, Jewish Journal

… on Dec. 19, 2007, the U.S. Attorney General’s Office filed an indictment in the U.S. District Court for the Central District of California naming the Chasidic yeshiva and four other Spinka organizations, as well as eight people, in a multimillion dollar tax fraud and money-laundering ring that stretched from Brooklyn to Los Angeles to Israel and elsewhere.

Two of those indicted are Rabbi Naftali Tzi Weisz, 59, the Grand Rabbi of Spinka, a Brooklyn-based Chasidic sect, whose yeshiva is in this undistinguished building, and his gabbai (assistant), Moshe Zigelman, 60.

Weisz is just one of a number of Grand Rebbes of Spinka, a Chasidic sect that originated in Romania in the 19th century. He is the great-great-grandson of the founding rabbi, and one of about a dozen Grand Spinka Rebbes who live in Boro Park or Williamsburg, in Brooklyn, or Bnei Brak and Jerusalem in Israel.

Four Los Angeles men were among those charged with taking part in the scheme: Yaacov (Yankel) Zeivald, 43, a self-described scribe (sofer) from Valley Village (photo, right); Yosef Nachum Naiman, 55, the owner of Shatz Et Naiman, d.b.a. Jerusalem Tours; Alan Jay Friedman, 43, a businessman from Pico-Robertson who sits on the board of the Orthodox Union; and Moshe Lazar, 60, owner of Lazar Diamonds, a Los Angeles jewelry company.

Although many of the details of the case have not yet been revealed — a trial date is set for Feb. 12, but the defendants’ lawyers say it will be postponed at least a year — what is emerging from the indictment, the search warrant and other documents of public record is a complex money-laundering scheme. According to the documents, people donated money to the Spinka institutions but then received 80 percent to 95 percent of their donations back, yet wrote off the full amount on their taxes.

These charges are just the beginning of a much larger case, Daniel J. O’Brien, an assistant U.S. attorney in the major frauds section, based in Los Angeles, said in an interview with The Journal.

“There were many other people that contributed in this fashion that would be the subject of government investigations,” O’Brien said.

While O’Brien said he has documentation that the Spinka institutions took in about $750,000 through the scheme — then writing receipts for $8.7 million — in 2007 alone, the assistant U.S. attorney believes the fraud has been going on for decades: “I believe this goes on beyond living memory,” possibly for generations.

This is certainly not the first time an ultra-Orthodox sect has been accused of attempting to break the laws of the secular government — aramos, or schemes, were perpetrated over the centuries in the shtetls of Europe. In the last decade, arrests have occurred in religious communities in Brooklyn, Lakewood, N.J., and upstate New York.

However, this particular case has shocked Los Angeles’ ultra-Orthodox community, not only because Los Angeles had largely been exempt from such cases in the past, but also because some of the city’s prominent members have been charged as being at the center of the scheme.

As a result, the case has sparked a fierce debate about the type of behavior that is acceptable for observant people and what type of religious community Los Angeles would like to be. But there’s also debate about the laws of a moser, an informant, because one person who was not charged was the primary source of information for the federal case — though he allegedly started out as one of the perpetrators …

Full Article:

http://www.jewishjournal.com/home/preview.php?id=18767

A reader who sent in this article comments:

A quite interesting follow-up article; note the lack of moral outrage over the -alleged- crime, the main problem being the debate over the moser.

“the fraud has been going on for decades: “I believe this goes on beyond living memory,” possibly for generations.”

“aramos, or schemes, were perpetrated over the centuries in the shtetls of Europe.”

The writer conveniently omits the fact this kind of behaviour could lead to the irrational mental disease affecting Christian victims of those swindlers, known as anti-semitism.

Follow Up on Spinka Tax Scheme

January 22, 2008

This is a follow up on this story: Elder Brothers Caught Scheming

The Spinka money trail — and the informant who brought them down

2008-01-11

Amy Klein, Jewish Journal

… on Dec. 19, 2007, the U.S. Attorney General’s Office filed an indictment in the U.S. District Court for the Central District of California naming the Chasidic yeshiva and four other Spinka organizations, as well as eight people, in a multimillion dollar tax fraud and money-laundering ring that stretched from Brooklyn to Los Angeles to Israel and elsewhere.

Two of those indicted are Rabbi Naftali Tzi Weisz, 59, the Grand Rabbi of Spinka, a Brooklyn-based Chasidic sect, whose yeshiva is in this undistinguished building, and his gabbai (assistant), Moshe Zigelman, 60.

Weisz is just one of a number of Grand Rebbes of Spinka, a Chasidic sect that originated in Romania in the 19th century. He is the great-great-grandson of the founding rabbi, and one of about a dozen Grand Spinka Rebbes who live in Boro Park or Williamsburg, in Brooklyn, or Bnei Brak and Jerusalem in Israel.

Four Los Angeles men were among those charged with taking part in the scheme: Yaacov (Yankel) Zeivald, 43, a self-described scribe (sofer) from Valley Village (photo, right); Yosef Nachum Naiman, 55, the owner of Shatz Et Naiman, d.b.a. Jerusalem Tours; Alan Jay Friedman, 43, a businessman from Pico-Robertson who sits on the board of the Orthodox Union; and Moshe Lazar, 60, owner of Lazar Diamonds, a Los Angeles jewelry company.

Although many of the details of the case have not yet been revealed — a trial date is set for Feb. 12, but the defendants’ lawyers say it will be postponed at least a year — what is emerging from the indictment, the search warrant and other documents of public record is a complex money-laundering scheme. According to the documents, people donated money to the Spinka institutions but then received 80 percent to 95 percent of their donations back, yet wrote off the full amount on their taxes.

These charges are just the beginning of a much larger case, Daniel J. O’Brien, an assistant U.S. attorney in the major frauds section, based in Los Angeles, said in an interview with The Journal.

“There were many other people that contributed in this fashion that would be the subject of government investigations,” O’Brien said.

While O’Brien said he has documentation that the Spinka institutions took in about $750,000 through the scheme — then writing receipts for $8.7 million — in 2007 alone, the assistant U.S. attorney believes the fraud has been going on for decades: “I believe this goes on beyond living memory,” possibly for generations.

This is certainly not the first time an ultra-Orthodox sect has been accused of attempting to break the laws of the secular government — aramos, or schemes, were perpetrated over the centuries in the shtetls of Europe. In the last decade, arrests have occurred in religious communities in Brooklyn, Lakewood, N.J., and upstate New York.

However, this particular case has shocked Los Angeles’ ultra-Orthodox community, not only because Los Angeles had largely been exempt from such cases in the past, but also because some of the city’s prominent members have been charged as being at the center of the scheme.

As a result, the case has sparked a fierce debate about the type of behavior that is acceptable for observant people and what type of religious community Los Angeles would like to be. But there’s also debate about the laws of a moser, an informant, because one person who was not charged was the primary source of information for the federal case — though he allegedly started out as one of the perpetrators …

Full Article:

http://www.jewishjournal.com/home/preview.php?id=18767

A reader who sent in this article comments:

A quite interesting follow-up article; note the lack of moral outrage over the -alleged- crime, the main problem being the debate over the moser.

“the fraud has been going on for decades: “I believe this goes on beyond living memory,” possibly for generations.”

“aramos, or schemes, were perpetrated over the centuries in the shtetls of Europe.”

The writer conveniently omits the fact this kind of behaviour could lead to the irrational mental disease affecting Christian victims of those swindlers, known as anti-semitism.

Elder Brothers Caught Scheming

December 20, 2007

This is Judaism par excellence–the religion of Benedict’s elder brothers; the religion “which Christianity has sprung from,” according to the Vatican.

Jewish sect leader held on charges of money laundering

Spinka rabbi faces multiple counts in an alleged tax scheme.

By Tiffany Hsu, Los Angeles Times Staff Writer
December 20, 2007

The leader of an Orthodox Jewish sect was arrested Wednesday after authorities unsealed a sweeping 37-count indictment alleging that he operated a decade-long tax fraud and money laundering scheme stretching from Israel through New York to downtown Los Angeles’ jewelry district, authorities said.

Grand Rabbi Naftali Tzi Weisz, head of the Spinka religious group, and his executive assistant, Gabbai Moseh E. Zigelman, are accused of soliciting “tens of millions of dollars” in contributions to Spinka charities while secretly promising to refund up to 95% of contributors’ donations, federal prosecutors said. The contributors then illegally claimed tax deductions on their bogus donations.

Weisz and Zigelman calculated in January that Zigelman alone had solicited nearly $9 million in 2006, with a $700,000 profit for Spinka after donors were repaid, according to the indictment.

Spinka Jews are members of the Hasidic group within Orthodox Judaism. The sect originated in Romania and has a large population in Israel, Europe and Brooklyn, N.Y., where Weisz and Zigelman reside.

Full Article:

http://www.latimes.com/news/local/la-me-rabbi20dec20,0,4164354.story?coll=la-home-center

Hasidic Rabbi and Assistant Are Arrested in Tax Scheme

By ALAN FEUER
Published: December 20, 2007

The grand rabbi of Spinka, a Brooklyn-based Hasidic sect, was arrested Wednesday with his executive assistant in Los Angeles on charges that they arranged and profited from inflated charitable donations that saved the donors millions of dollars in federal income taxes.

The rabbi, Naftali Tzi Weisz, 59, and the assistant, or gabbai, Moshe E. Zigelman, 60, were charged in a 37-count indictment returned on Tuesday in Los Angeles that named them as the masterminds of the money-laundering scheme, through which the authorities say they reaped more than $750,000 in profits. They were arrested by federal agents while on a fund-raising trip. Six other men in California and in Israel were also charged in the case.

Under the scheme, officials said, Rabbi Weisz and Mr. Zigelman spent more than a decade soliciting contributions for Spinka charities by promising to secretly refund as much as 95 percent of the money to the donors. The donors could then claim tax deductions on the full amount while paying as little as 5 percent, officials said.

In some cases, the contributions were returned as cash payments through what the government called “an underground money transfer network” involving businesses in and around Los Angeles’s jewelry district, the government said.

Three men in California were charged with taking part in the money transfer network: Yaacov Zeivald, 43, a professional scribe from Valley Village, Calif.; Yosef N. Naiman, 55, a tour company owner from Los Angeles; and Alan Friedman, 43, a businessman, also from Los Angeles. A fourth man, Moshe A. Lazar, 60, a diamond dealer, was charged in the scheme as well and was believed to be in Israel, the government said.

The contributions were repaid by a sophisticated series of wire transfers from businesses controlled by the Spinka sect to secret accounts in Israel, the government said. The accounts were established with the help of an official at the Israeli bank, Joseph Roth, 66, of Tel Aviv, who was arrested in Los Angeles, and a Tel Aviv lawyer, Jacob Kantor, 71, who remained at large in Israel, the government said.

According to the indictment, Mr. Roth helped the contributors get loans from a Los Angeles branch of the bank so their money would be available to them in the United States. The contributors could also hire officials of the Spinka sect to repatriate their money for them, albeit for a fee, the government said.

Earlier this year, the indictment said, Rabbi Weisz and Mr. Zigelman determined they had taken in some $8.7 million in contributions solicited by Mr. Zigelman alone. Of that, they held on to almost $750,000, the indictment said.

The case was broken, in part, with the help of a secret cooperating witness, a Los Angeles businessman identified in the indictment only as R. K. In one year alone, before he turned state’s evidence and agreed to record his former colleagues secretly, R. K. contributed about $1.7 million to the Spinka sect’s scheme.

Five Spinka charitable organizations in Brooklyn — identified in the indictment as Yeshiva Imrei Yosef, Yeshivath Spinka, the Central Rabbinical Seminary, Machne Sva Rotzohn and Mesivta Imrei Yosef Spinka — were named as defendants in the case. Calls to them were either not answered or were answered by men who did not wish to discuss the case.

http://www.nytimes.com/2007/12/20/nyregion/20rabbis.html?ex=1198818000&en=402d974cbe49b64f&ei=5070&emc=eta1

Elder Brothers Caught Scheming

December 20, 2007

This is Judaism par excellence–the religion of Benedict’s elder brothers; the religion “which Christianity has sprung from,” according to the Vatican.

Jewish sect leader held on charges of money laundering

Spinka rabbi faces multiple counts in an alleged tax scheme.

By Tiffany Hsu, Los Angeles Times Staff Writer
December 20, 2007

The leader of an Orthodox Jewish sect was arrested Wednesday after authorities unsealed a sweeping 37-count indictment alleging that he operated a decade-long tax fraud and money laundering scheme stretching from Israel through New York to downtown Los Angeles’ jewelry district, authorities said.

Grand Rabbi Naftali Tzi Weisz, head of the Spinka religious group, and his executive assistant, Gabbai Moseh E. Zigelman, are accused of soliciting “tens of millions of dollars” in contributions to Spinka charities while secretly promising to refund up to 95% of contributors’ donations, federal prosecutors said. The contributors then illegally claimed tax deductions on their bogus donations.

Weisz and Zigelman calculated in January that Zigelman alone had solicited nearly $9 million in 2006, with a $700,000 profit for Spinka after donors were repaid, according to the indictment.

Spinka Jews are members of the Hasidic group within Orthodox Judaism. The sect originated in Romania and has a large population in Israel, Europe and Brooklyn, N.Y., where Weisz and Zigelman reside.

Full Article:

http://www.latimes.com/news/local/la-me-rabbi20dec20,0,4164354.story?coll=la-home-center

Hasidic Rabbi and Assistant Are Arrested in Tax Scheme

By ALAN FEUER
Published: December 20, 2007

The grand rabbi of Spinka, a Brooklyn-based Hasidic sect, was arrested Wednesday with his executive assistant in Los Angeles on charges that they arranged and profited from inflated charitable donations that saved the donors millions of dollars in federal income taxes.

The rabbi, Naftali Tzi Weisz, 59, and the assistant, or gabbai, Moshe E. Zigelman, 60, were charged in a 37-count indictment returned on Tuesday in Los Angeles that named them as the masterminds of the money-laundering scheme, through which the authorities say they reaped more than $750,000 in profits. They were arrested by federal agents while on a fund-raising trip. Six other men in California and in Israel were also charged in the case.

Under the scheme, officials said, Rabbi Weisz and Mr. Zigelman spent more than a decade soliciting contributions for Spinka charities by promising to secretly refund as much as 95 percent of the money to the donors. The donors could then claim tax deductions on the full amount while paying as little as 5 percent, officials said.

In some cases, the contributions were returned as cash payments through what the government called “an underground money transfer network” involving businesses in and around Los Angeles’s jewelry district, the government said.

Three men in California were charged with taking part in the money transfer network: Yaacov Zeivald, 43, a professional scribe from Valley Village, Calif.; Yosef N. Naiman, 55, a tour company owner from Los Angeles; and Alan Friedman, 43, a businessman, also from Los Angeles. A fourth man, Moshe A. Lazar, 60, a diamond dealer, was charged in the scheme as well and was believed to be in Israel, the government said.

The contributions were repaid by a sophisticated series of wire transfers from businesses controlled by the Spinka sect to secret accounts in Israel, the government said. The accounts were established with the help of an official at the Israeli bank, Joseph Roth, 66, of Tel Aviv, who was arrested in Los Angeles, and a Tel Aviv lawyer, Jacob Kantor, 71, who remained at large in Israel, the government said.

According to the indictment, Mr. Roth helped the contributors get loans from a Los Angeles branch of the bank so their money would be available to them in the United States. The contributors could also hire officials of the Spinka sect to repatriate their money for them, albeit for a fee, the government said.

Earlier this year, the indictment said, Rabbi Weisz and Mr. Zigelman determined they had taken in some $8.7 million in contributions solicited by Mr. Zigelman alone. Of that, they held on to almost $750,000, the indictment said.

The case was broken, in part, with the help of a secret cooperating witness, a Los Angeles businessman identified in the indictment only as R. K. In one year alone, before he turned state’s evidence and agreed to record his former colleagues secretly, R. K. contributed about $1.7 million to the Spinka sect’s scheme.

Five Spinka charitable organizations in Brooklyn — identified in the indictment as Yeshiva Imrei Yosef, Yeshivath Spinka, the Central Rabbinical Seminary, Machne Sva Rotzohn and Mesivta Imrei Yosef Spinka — were named as defendants in the case. Calls to them were either not answered or were answered by men who did not wish to discuss the case.

http://www.nytimes.com/2007/12/20/nyregion/20rabbis.html?ex=1198818000&en=402d974cbe49b64f&ei=5070&emc=eta1