Spinka Grand Rabbi, Four Others Plead Guilty


Rabbi Naftali Tzvi Weisz, the Brooklyn-based grand rabbi of the Spinka sect, along with four local associates, pleaded guilty to criminal conspiracy charges in downtown federal district court Monday.

As part of the plea agreement, Weisz, 61, admitted he worked with others in a decade-long $8.5 million tax fraud and money-laundering scheme, which was set up to fund four charities and a school for Spinka, an ultra-Orthodox sect that originated in 19th century Romania and has adherents in Israel, Europe and Brooklyn.

The Spinka pleas come nearly two weeks after U.S. prosecutors charged five Syrian rabbis from New York and New Jersey in a public corruption and international money-laundering investigation that included three mayors and two state assemblymen. But local prosecutors say the July 23 arrests had no direct influence on Monday’s guilty pleas.

“They had executed the plea agreement prior to the arrests in New Jersey,” U.S. assistant attorney Dan O’Brien said. 

According to the federal prosecutors, the Spinka scam began in 1996 and continued until 2007, laundering money back to donors — up to 95 percent, based on court documents — through a network of Los Angeles businesses, including some in and around the city’s downtown jewelry district, as well as through donors and the Tel Aviv-based United Mizrahi Bank and its Los Angeles branch.

In his plea agreement, Weisz admitted learning from his assistant, Gabbai Moshe E. Zigelman, that Spinka charities received nearly $8.5 million in 2006 and had “profits” of $744,596 after deducting amounts paid back to various contributors.

Los Angeles businessman Robert Kasirer, who had helped raise money for Spinka, first tipped off investigators about the scam in October 2004, when he turned state’s evidence in exchange for a reduced sentence on civil fraud charges stemming from his health care business.

The four local Spinka associates who also pleaded guilty Monday for their roles in the money-transfer network included Alan Jay Friedman, 45; Moshe Arie Lazar, 62; Yosef Nachum Naiman, 57; and Yaacov Zeivald, 44.

In March, Weisz’s assistant, Zigelman, 62, was sentenced to two years in federal prison after he pleaded guilty in June 2008. Joseph Roth, an Israeli banker who also pleaded guilty in June 2008 for his role, was sentenced to 14 months and released on time served.

Weisz is scheduled for a Nov. 16 sentencing and is expected to face a maximum sentence of three years in federal prison. Friedman, Lazar and Zeivald will be sentenced Nov. 23, while Naiman will appear on Nov. 30.

Defense attorneys were not immediately available for comment.

Federal prosecutors are still investigating more than 100 contributors to Spinka charities, and O’Brien said he expects two plea agreements from contributors in the coming weeks.

Attorneys for five Spinka charitable organizations are scheduled to appear before U.S. District Judge John F. Walter regarding a plea agreement for Spinka’s charities on Wednesday. Yeshiva Imrei Yosef Spinka is expected to enter a guilty plea to similar conspiracy charges, and will likely face a fine. As part of the plea agreement, which was filed Tuesday, O’Brien said other Spinka charities would not be charged but would face strict compliance rules, including maintaining detailed accounting records and adopting corporate ethics rules.
Sentencing for the yeshiva is also expected to take place in November.

Rabbi Cooper; Enough with the Spinka; Tuskeegee Airmen


Bloods, Crips and Rabbis
In profiling Rabbi Abe Cooper, I’m glad you mentioned his work in combating hate in cyberspace (“The Bloods, The Crips and The Rabbi,” Jan. 18). What is particularly noteworthy is how he has resisted the temptation to push for government censorship and instead has heeded the teaching of Justice Louis Brandeis (who not incidentally was the first Jew on the U.S. Supreme Court), who wrote that those “who won our revolution were not cowards. They did not fear political change. They did not exalt order at the cost of liberty.”

By supporting conferences and online technology to combat bigotry and anti-Semitism on the Internet, Cooper has adhered to Brandeis’s proscription that “If there be time to expose through discussion the falsehood and fallacies, to avert the evil by the processes of education, the remedy to be applied is more speech, not enforced silence.”

Stephen F. Rohde
Vice President
Progressive Jewish Alliance

Your headline on the front page of your Jan. 18 edition states, “What’s This Guy Have to Do With the Crips?” Next to the headline is a dignified picture of Rabbi Abe Cooper. My question is why does a fine paper like The Jewish Journal find it necessary to downgrade the English language by using the slang word “guy” instead of using the word man? The television media standards continue to sink.

Please don’t let the print media fall into the same abyss.

Leon M. Salter
Los Angeles

Dirty Laundry
One of the worst things that a Jewish person can do is to bring shame to the Jewish People (“Following the Spinka Money Trail,” Jan. 11). Shame on you Jewish Journal. Your cover story and photograph did exactly that. I’m not saying that the story shouldn’t have been covered. It could have been done in a less embarrassing way, and it certainly didn’t need to be on the front page and in our faces. It’s nothing to boast about or to be proud of.

In the future, I hope that you and The Jewish Journal will focus on the good things in our Jewish community and not bring us any unnecessary shame and embarrassment.

Judith Rubin
Los Angeles

Young Menschen
I must add to Rob Eshman and Marjorie Pressman’s comments about our pride in Benji Davis and David Landau (“Brave + Mensch = ?” Dec. 28). Both Benji and David are former regional officers of Far West Region United Synagogue Youth.

Benji was the religion/education vice president from 2004-2005 and David was the Israel affairs vice president from 2005-2006. Following their graduations from high school, both young men spent their freshman year in Israel on the Nativ College Leadership Program, sponsored by the United Synagogue for Conservative Judaism. I could not be prouder of these two remarkable young men. Kol Hakavod to their families and the “village” that helped raise them.

Merrill Alpert
Director, Youth Activities
Far West Region United Synagogue Youth

Pilots Over Auschwitz
The “Black Pilots Over Auschwitz” opinion piece by Rafael Medoff … appears to strive for some relevancy but the message is diluted by its emphasis on the race of the fighter pilots (Jan. 18). What is unknown is if any of the pilots engaged in the mission of Aug. 20, 1944, to bomb the factories near Auschwitz were even remotely aware of the daily atrocities occurring at Auschwitz. History tells us that the chances are they were not. And if not, what does the race of the bomber or Mustang pilots have to do with the subject of the piece? If the all-white pilots of the Flying Fortresses could testify just as compellingly as the all-black pilots of the Mustangs to the technical viability of a bombing mission on Auschwitz — which they obviously could — what is the point of the piece?

Is it merely a “feel-good” to demonstrate that Jews and Blacks could have intersected at points in history to make life better for the both of us? Or is it something else?

By the by, it appears that Mr. Medoff has deconstructed, either intentionally or inadvertently, a most cherished historical “fact” ascribed to the Tuskeegee Airmen: that they never lost a plane they were tasked with protecting. Either they did, which makes a portion of the piece false; or they didn’t, which makes their vaunted reputation a lie.

Franklin S. Adler
Beverly Hills

Program for Grandparents
Although I totally agree with organizing support groups for grandparents with intermarried children, and, in fact, have conducted similar programs for years, I take issue with the subtle derision aimed at “Hebrew school teachers” (“Program Helps Grandparents Nurture Interfaith Grandkids,” Jan. 18). Would that every Jewish grandparent might have the devotion to educating our children that our teachers display each time they walk into the classroom.

Judy Aronson
Faculty member
Academy for Jewish Religion/California

Yiddish Dancers
As one of the co-chairs of the XIII Lithuanian Folk Dance Festival, I would like to express, on behalf of our organizing committee, our extreme disappointment with the Jan. 11, 2008 article by Jane Ulman titled “Lithuanian Festival Excludes Yiddish Dancers.” The heading of the article strongly conveys the impression that we went out of our way to deliberately exclude Yiddish dancers from participating in our festival. This could not be more erroneous.

The Lithuanian Folk Dance Festival is an international celebration of Lithuanian Folk dance held every four years, whose sole purpose is the mission of preserving and nurturing the art of folk dancing together with its music, authentic costumes and traditions. Many groups have members of non-Lithuanian descent, and this is not a criterion for participation. The festival welcomes any group, or individual, that is willing to learn the dances as part of a synchronized routine. This is the only criterion for participating.

We urge you to avoid politicizing the XIII Lithuanian Folk Dance Festival and accept it as a cultural event that embraces all participants who come to celebrate Lithuanian dance.

Spinker? I just met her!


Spinka Money Trails

Sadly missing from Amy Klein’s thorough investigation from “Boro Park to L.A. (Dirty Laundry)” was the question that seems to be embedded in every news article when reporting on a perpetrated evil. Why? (“Following the Spinka Money Trail,” Jan. 11).

We are enjoined to search for the deeper meaning behind those who riot in the streets of Los Angeles or blow themselves up in Israeli pizzerias. Evil does not happen on its own, we are assured; there must be a “justification” or “rationalization” that explains it all.

So why would an otherwise holy and pious Jew — a leader of Chassidic sect — allegedly succumb to the temptation of being an accomplice to a crime just to help some greedy businessmen achieve an unearned tax write-off?

I can’t be sure of the reason but I do submit a challenge to the Jewish community at large. Have we done our part in helping our brethren — be they Chassidic schools in New York or any of our local Jewish day schools — maintain their bastions of Torah scholarship and Jewish culture? There are no yachts in Brooklyn as Amy Klein points out, but there are thousands of Jewish kinderlach that need a quality education.

Michael Steinhardt, the famed Jewish philanthropist wrote in the pages of this newspaper on July 28, 2006: “We are donors to universities, museums, orchestras and hospitals, but when it comes to Jewish philanthropy, we fall short. Today, perhaps 20 percent or less of Jewish giving goes to Jewish causes…. Of the $5.3 billion in megagifts given by America’s wealthiest Jews between 1995 and 2000, a mere 6 percent went to Jewish institutions……. Only 11 percent of Jews donate over $1,000 to Jewish causes.”

No one I know is condoning the crime or the chilul Hashem that the article speaks of. But is it perhaps a wake-up call to all of us — since a shande impacts all Jews, regardless of religious persuasion — to prioritize our tzedakah by first and foremost helping our struggling schools and yeshivas? Wouldn’t it be nice if a Chassidic rebbe could teach Torah and shepherd his flock without having to worry about covering an overwhelming daily budget?

Name Withheld Upon Request

In Amy Klein’s piece about allegations of corruption against Rabbi Naftali Tzi Weisz and other members of a segment of the Spinka Chasidic community, she writes, “Weisz is just one of a number of Grand Rebbes of Spinka, a Chasidic sect.”

I can’t help but wonder what makes Chasidim members of sects.

Yes, I know that many dictionaries define sect as a subdivision of a larger religious group but the truth is, that is not really how the word is used today.

For example, in recent years a number of articles have appeared in The Jewish Journal and other publication about the “Satmar Chasidic Sect.” There are approximately twice as many Satmar Chasidim in the world (100,000 to 150,000) as there are Reconstructionist Jews (50,000 to 75,000), yet when was the last time you read any left-wing Jewish journalist writing about “the Reconstructionist Sect.”

The simple truth is we know that the “nod/wink” meaning of people who belong to a sect is that they are weird, unenlightened, lack individuality and don’t think for themselves. The word sect robs people of their humanity. It is often used interchangeably with the word cult.

Let the case against Rabbi Weisz and other Spinka Chasidim play itself out, but treat individual Chasidim with the respect they deserve.

If sex discrimination is bad how can “sects” discrimination be good?

Rafael Guber
New York, N.Y.

The circumstances and substance of the accusations involving the Spinka Rabbi and the Spinka institutions are quite troubling to this tax lawyer whose son now learns in a yeshiva in Israel.

Without jumping to judgment, and maintaining the presumption of innocence accorded to all of the accused under American law, the following matters are noted:

Rabbi Moshe Feinstein, the leading halachic authority of his generation, issued a responsum allowing a Jew to be an IRS agent, even where the audit assignments might uncover criminal tax evasion by Jews and lead to prosecution and imprisonment of the Jewish tax evaders.

The Talmud (Baba Kama 113a) specifically requires that taxes imposed by a legitimate and just secular government be paid. Maimonides further expounded on this rule.

The very first paragraph of the first chapter of Pirkei Avot admonishes us to “erect a fence for the Torah,” meaning that we must impose stringencies beyond the letter of the law so that we do not inadvertently transgress it.

Kenneth H. Ryesky, Esq.
East Northport, N.Y.
The author formerly served as an attorney for the Internal Revenue Service, Manhattan District.

I read the Journal article, “Following the Spinka Money Trail” with embarrassment and shock.

My greatest shock is in observing that I hear little from those who revere the Spinka rabbi about the enormous illegal inflow of money to those laundering it without shame for donors who are scofflaws. Rather is the anger directed against the informant, and the misguided self-righteousness that defrauding the government is justified?

A strong principle in Jewish law, stated in Baba Batra and Gittin, is Dina d’Malchuta Dina: the law of the government is the law, (binding upon the Jewish people.) This is stressed by leading authorities from the Rambam to Rabbi Moshe Feinstein. He wrote in Igrot Moshe: We are certainly forbidden by God, may He be blessed, who commanded us in his holy Torah from taking more funds or assets than is permitted by the laws and regulations of the government. This is true even if we can somehow get more from certain functionaries who would like to help our institutions not in accordance with established governmental guidelines … so that they should not cause stealing and losses to the government, even inadvertently, in violation of the laws of the Torah and laws of the government.”

My hope is that this current public exposure will lead to a complete sanitizing of the treatment of monies donated to all our Jewish institutions. Let the Jewish name be identified with honesty and integrity. Let us demonstrate that the Jewish community will keep its promise to Peter Stuyvesant that we will always assume responsibility for maintaining our Jewish life in this land, which has given us the opportunity to conduct it in peace.

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


The first snow flutters hesitantly in Brooklyn. Men wearing fur streimel hats and women wearing sheitls walk briskly past the corner of 15th Avenue and 58th Street in Boro Park as if nothing extraordinary has happened here.

And why not? The kosher shops of this self-contained ultra-Orthodox neighborhood — practically a city onto itself — are still a few blocks down, and here on this bleak corner, there are only three orange school buses parked in front of a four-story, dark-red brick building, which sits on a residential street, where tall, narrow houses nearly overlap. The structure (photo below) is rather nondescript and unimposing — garbage bags are piled haphazardly by a front gate, bars protect the windows, young boys can be heard chanting from behind the locked door and a white sign with sky blue Hebrew lettering reads: “Yeshiva Imrei Yosef Spinka.”

yeshiva imrei yosef spinka

A buzzer sounds. The door opens. No one asks who rang the bell. Up the four steps, a reception window sits empty. Hazy yellow fluorescent lights illuminate the narrow hallways adorned with graying yellow paint and frayed industrial carpeting. If there are millions — or even thousands — of dollars going to the Spinka yeshiva, it certainly doesn’t seem like it’s coming here.

This despite the fact that 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 yaacov zievaldoriginated 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.

THE BEGINNING

On June 29, 2004, the U.S. Securities and Exchange Commission filed civil fraud charges against Robert A. Kasirer and four executives of Heritage Healthcare of America, which sold $131 million in bonds to 1,800 investors in 36 states from 1996-1999, claiming that the money would be used to fund 10 health care facilities. In October of that year, Kasirer approached the federal government and “expressed a desire to plead guilty to criminal charges arising out of the investigation and agreed to reveal other criminal conduct he and others had committed, with a view that any sentence he might receive would be reduced,” according to an affidavit for a search warrant submitted by FBI Special Agent Ryan Heaton on Dec. 18, 2007.

Although the search warrant affidavit identifies Kasirer only as “confidential witness (CW-1)” and the recent grand jury indictment refers to a witness named only as RK, the companies in the affidavit attributed to CW-1 and RK are run by Kasirer, and several members of the Los Angeles community, who asked for confidentiality, have confirmed his involvement.

In 2004, under federal surveillance, the informant identified in the transcript as CW-1 resumed activities he admitted to having conducted with the Spinka since 1990, in which “he caused several million dollars in contributions to be mailed to the tax-exempt organizations operating within the umbrella of Spinka,” he is quoted in federal documents as having told the FBI.

Grand Rabbi pleads not guilty


LOS ANGELES – The Grand Rabbi of Spinka, head of a Brooklyn-based Chasidic sect, and five other men pleaded not guilty Monday to federal charges of tax evasion and money laundering.

Naftalie Tzi Weisz, the 59-year old grand rabbi, and the other accused appeared in U.S. District Court in downtown Los Angeles before U.S. Magistrate Judge Alicia Rosenberg, who set Feb. 12 for trial.

A federal grand jury indicted the men and five Spinka charities on Dec. 18 on charges of participating in fraudulent kickback scheme that cheated the Internal Revenue Service of at least $33 million.

In the alleged scheme, donors to Spinka charities were refunded up to 95 percent of their donations, who then claimed the full amounts as tax deductions.

The kickbacks were laundered through the Mizrahi Bank in Tel Aviv and businesses in the Los Angeles jewelry district, according to prosecutors.

Other named defendants are Weisz’s gabbai, or assistant, Moshe Zigelman, 60, also of Brooklyn, Joseph Roth, 66, of Tel Aviv, and three Los Angeles area residents, Yaacov Zeivald, 43, Alan Jay Friedman, 43, and Yosef Nachum Naiman, 55.

Weisz and Zigelman allegedly made more than $750,000 from the transactions.

All are free on bond, except Roth, an assistant manager at the Mizrahi Bank, who is considered a flight risk to Israel by the prosecution. Roth had been granted a $1.9 million bond by another magistrate, but who stayed the decision so that government prosecutors could draft an appeal. The defendants face lengthy terms in prison terms if convicted of the charges.


Local Orthodox community in shock after arrest of Spinka rabbiBy Amy Klein, Religion Editor

The Los Angeles Orthodox Community went into shock this week over the federal indictment of four of their own. They were among eight men accused of running a tax fraud scheme funneled through a Brooklyn Yeshiva.

On Dec. 19, Los Angeles authorities arrested six people, including Naftali Tzi Weisz, 59, the grand rabbi of Spinka, a Brooklyn-based Hasidic sect, on charges of creating a money-laundering scheme that worked through financial networks in Los Angeles and Israel. Two of the eight remained at large as of Dec. 21. The four men arrested have been released on bail.

The 37-count indictment against the rabbi, who is being represented by well-known attorney Donald Etra, alleges that he and his gabbai (assistant), Moshe E. Zigelman, 60, raked in more than $750,000 by soliciting millions of dollars in contributions to Spinka charities while promising to secretly return up to 95% of donations.

Four Los Angeles men were among those charged with taking part in the scheme: Yaacov (Yankel) Zeivald, 43, a self-described scribe from Valley Village ; Yosef Nachum Naiman, 55, the owner of Shatz Et Naiman, dba Jerusalem Tours; Alan Jay Friedman, 43, a businessman, also from Los Angeles. All three were released on bail on Wednesday. Moshe (Marvin) Arie Lazar, 60, the owner of Lazar Diamonds here, is believed to be in Israel, according to the federal officials.

Naiman, Friedman and Lazar all reside in the Hancock Park/Fairfax ultra-Orthodox neighborhood, although they are not all Hasidic. Friedman sits on the Board of Directors of the Orthodox Union.

A fifth Angeleno, named in the indictment as R.K., was a member of the conspiracy from 1996 through October 2004 and then became a cooperating witness for the government. The Journal could not confirm at press time the alleged identity of R.K., which was being circulated in the Orthodox community.

“The Fraudulent Charitable Contribution Scheme,” according to the grand jury, began in 1996 and continued through 2007, where the defendants would secretly refund to certain Spinka contributors from 80 to 95 percent of their nominal contributions to Spinka charitable organizations,” the indictment said. “In this manner, the conspiring contributors could fraudulently claim as tax deductions the full amounts of their nominal contributions tothe Spinka charitable organizations, while having actually contributed as little as 5 to 20 percent of the amounts of the claimed deductions. The conspiring contributors could also usethe fraudulent Spinka charitable contributions to promote other unlawful activity including, in the case of co-conspirator R.K., the fraudulent concealment of assets from the SEC.”

In Los Angeles’ tight-knit ultra-Orthodox community in the Fairfax-Beverly, Hancock Park neighborhood, people were quietly talking about the case and were extremely upset that members of their community may have been involved in such a “non-religious” activity.

“One thing is clear: The Orthodox community deplores any attempt to defraud the government of the United States, and there is no excuse for it, and there’s no rationalizations that are acceptable,” said Rabbi Meyer H. May, president of the Rabbinical Council of California. “It’s against the Torah and it’s against our moral foundation. At the same time, regarding these specific individuals, they should be allowed to have a fair trial, as everyone is innocent until proven guilty.” He also stressed that people should beware of lashon hara, or gossip, of discussing this case, and to keep in mind that there are wives and children and family members who might also be hurt.

But whatever the verdict on the accused, Rabbi May said this should be a wake-up call to the community. “The community should look deeply inside itself to examine its values, its commitment to truth, and its understanding of what God really wants us to be and how he wants us to act. We are here in this world to sanctify the name of God and not to denigrate it.”

He stressed that the accused are individuals, not representatives of the Orthodox or Hasidic community. “Ninety nine percent do pay taxes correctly, do abide by the law, do take their positions as citizens of the United States seriously and ethically.”

This is not the first time a Hasidic sect has been using their institution to funnel money. In January 2001, outgoing president Bill Clinton controversially pardoned four Sqverer Hasidim who were serving prison sentences of up to 6 1/2 years for bilking $40 million worth of student Pell grants and loans from government sources for a phony school in the Hasidic community of New Square, N.Y.