The Allegedly Problematic Benefactors and Lubavitch Educational Center, Florida, Kiev, Crown Heights, Russia…

Chabad’s Strange Bedfellows and the Web of Interrelated Connections and People – A Gem of a Way to Coin Money…

The following are two interrelated and interconnected articles; and a link to a 2007 Wall Street Journal article which planted the seeds for the latest news. Suffice it to say, Chabad’s ties to money, power and a litany of high-powered donors is frightening in its scope. It shows the broadness of their reach.

The dots are easy to connect and are inextricably linked to the news earlier this year of ties to Chabad, the Ukraine, Guiliani and his associates. This is not to say that Guiliani has done anything wrong. That is not a statement which is being made or implied. We leave any assessments of that to far higher powers than the fingers behind this keyboard.

There are a few notable points, however, that we bring to your attention and that The Forward missed. They are important as follows:

1. Rabbi Berel Lazar (of Putin’s Soviet Chabad “mishpacha” [family]) is the brother of Mindy Zalmanov – mentioned in The Forward article below. Mindy is said to be Lazar’s liaison in the United States. 
2. The Link to Kiev and the Ukraine and Chabad came out months ago on numerous media sources; but the inextricable connections were published as early as 2007 by The Wall Street Journal in an article entitled: In Russia, a Top Rabbi Uses Kremlin Ties to Gain Power [https://www.wsj.com/articles/SB117858672536595256]:

MOSCOW — Of all the strange relationships that define today’s Russia, few are stranger than the alliance between President Vladimir Putin and an ultra-Orthodox rabbi named Berel Lazar.

Rabbi Lazar is a follower of Chabad-Lubavitch, a Hasidic sect based in Crown Heights, Brooklyn, that is on the fringes of mainstream Judaism. Its devotees are known for their love of the Rebbe, their late spiritual leader. Some even think he’s the Messiah.

3. Rabbi Lezar is industrious, not thing else, and he has strong ties to other notable figures including, but not limited to Diamond Magnate Lev Leviev, who also has ties to the US government through a variety  of diamond business. His alleged arch enemy, Dan Gertler seems to have ties to Guiliani who has registered to lobby on his behalf to have the Magnitsky Sanctions lifted. It is conceivable, albeit unusual, that Leviev and Gertler might have ties cloaked in long-standing business animosity.  

4. Don’t overlook the importance of Cleveland, the prominent families there, the Chabad connections or the efforts and crusade of one man to uncover financial improprieties in Cleveland. He has been largely bullied and harrassed for his scrutiny of financial records of major Jewish organizations in Cleveland, Ohio. But, his claims should not be understated. They are not being mentioned specifically here, but can be made available for law enforcement, that so far will not touch the Cleveland story.

4. There are no coincidences. 

Law enforcement really should be taking a look…

The Not-Uncommon Tale of a Benefactor Becoming a Problem

February 21, 2020; Forward

When a nonprofit’s financial status turns a glowing red, its board is faced with an existential moment. Should the nonprofit cut its losses, wind down operations, and go out of business as gracefully as possible? Or should it continue to search for sources of funding large enough to wipe out the debts and find a way to sustainability? Turns out that even if supporters do step forward, the worries may not be over. That’s the story of the Lubavitch Educational Center (LEC) in Florida.

Forward’s Molly Boigon writes that in 2013 the LEC was seriously past due on an $8 million loan and facing multiple foreclosures. The organization’s leadership, not ready to give up on its commitment to its students and close its schools, successfully found new philanthropic support to cover its operating losses. A generous group of benefactors banded together and purchased the LEC’s property at a foreclosure sale. They then provided the organization with an affordable long-term lease and sufficient funds to satisfy other debts so the LEC could continue serving its students.

Seven years later, that generosity seems ready to bite them. The Center is facing a problem that plagues nonprofit organizations of all sizes: what to do when a source of critical funding turns out to be tainted.

Two of the donors who saved the LEC, Mordechai Korf and Uriel Tzvi Laber, have been implicated as participants in a major international money-laundering scandal. The current owners of the Ukraine-based PrivatBank are suing the bank’s former owners, alleging they absconded with $470 billion—yes, with a “b”—through a complex set of fraudulent transactions. Korf and Laber, who were part of that ownership group, have been accused of illegally profiting from those financial manipulations. According to Forward

To continue reading click here.

They gave $25 million to Jewish nonprofits. Was some of that money laundered from Ukraine?

The Lubavitch Educational Center, a set of schools in South Florida teaching toddlers and Talmud scholars alike, nearly went out of business in 2013.

Past due on an $8 million loan, the center was facing foreclosure on three properties, including its main campus, an 84,020-square-foot behemoth on seven acres. A company made up of the center’s supporters won the foreclosure auction and gave it a long-term lease. Among the benefactors who helped the schools make up outstanding debts were Mordechai Korf and Uriel Tzvi Laber, partners in business and philanthropy whose $1.4 million donation was part of a philanthropic portfolio that pumped about $25 million into Jewish nonprofits between 2006 and 2018.

Now these two men, who represent the pinnacle of generosity to many religious Jews in Florida, are among the the targets of a lawsuit stemming from a Ukrainian money-laundering scheme that calls into question the legitimacy of years of their philanthropic contributions.

Korf and Laber owned [https://www.privatbank.lv/wp-content/uploads/2018/06/PB_2015_ENG.pdf] more than $6 million worth of shares — at least 7% — in PrivatBank, which, according to a 2018 report [https://old.bank.gov.ua/doccatalog/document?id=62483491] by the National Bank of Ukraine, “was subjected to a large, coordinated money-laundering scheme and bank fraud” to benefit the shareholders’ and their affiliates’ “business and personal interests.”

Ukraine nationalized PrivatBank in 2016, financing a bailout of more than $5.5 billion to save it from collapse as a result of the fraud, according to the NBU, which is a federal entity that regulates banks. PrivatBank was re-privatized in 2018, and the new owners filed a civil lawsuit in Delaware last May naming Korf and Laber as two of three U.S. “agents” who helped the the bank’s majority shareholders, two Ukranian billionaires, launder up to $470 billion — more than the GDP of Austria.

Korf, 47, and Laber, 48, declined through a representative to be interviewed or answer any questions related to their businesses or charitable giving.

Their lawyer, Marc Kasowitz, said via email that the allegations against them are “100% false and defamatory,” and the lawsuit “nothing more than a fictional orchestrated political attack” on the Ukrainians, who vocally opposed the president at the time.

The accusations “will be shown to be complete fabrications when the evidence in this case comes out,” said Kasowitz, who has also represented President Donald Trump in matters related to Russian interference in the 2016 presidential election. “Our clients have earned a well-deserved reputation for honesty and high integrity over the past 20+ years.”

Indeed, Korf and Laber, who each live in white-columned mansions in Miami Beach, are key supporters of the Chabad network in Florida, one of the movement’s largest, strongest and wealthiest communities in the world.

The Greater Miami Jewish Federation estimates that 42% of Jewish homes with children in the area have engaged with Chabad’s various branches and programs. The two men have donated and raised a total of more than $11 million for Chabad-related causes across Florida, according to their own foundations’ tax filings. Korf is one of the nine children of Rabbi Abraham Korf, the beloved founder of Miami’s Chabad center, and many local Chabad groups that received Laber and Mordechai Korf’s donations are run by Korf’s relatives.

Florida, with $11 million in donations over a dozen years, and New York, with $10 million, are the focal points of their Jewish giving. But the pair has also given money to Jewish organizations in Connecticut and Canada, Massachusetts and Montana, Denmark and Jerusalem. They give to synagogues, to schools, to summer camps and to Zionist organizations, with individual grants ranging from $180 to more than $1 million.

Weeks of investigation into Korf and Laber turned up new questions with each answer. It is unclear how they made their money; their businesses are nearly all implicated in the bank scheme. Their charitable foundations do not appear to be registered in Florida, as is required by law. Phone calls to their organizations became circular games of cat and mouse.

It is difficult to specifically track how money from PrivatBank’s loans may have filtered through Korf and Laber’s foundations to the Jewish nonprofits, and there is no evidence that any of the recipients were aware of the two men’s connection to the laundering. But if the lawsuit succeeds, the nonprofits could face demands to return the funds, a phenomenon called a “clawback.”

Peter Henning, a law professor at Wayne State University who prosecuted bank fraud at the Department of Justice, said launderers frequently slide money into charities to evade taxes and scrutiny, or to get “pats on the back.”

“If you’re going to funnel money to a charity, no one’s going to ask a lot of questions,” he said. “If you’re willing to give money, they’re going to take it.”

Jewish pioneers of South Florida

Korf, who is married and has at least five children, is part of one of the Chabad movement’s most prominent families. His parents, Abraham and Rivka, arrived in Miami from Brooklyn in the early 1960s as emissaries of the Lubavitcher Rebbe, Menachem Mendel Schneerson. After decades in which Florida’s Jews had been concentrated in Jacksonville, a northern port city, snowbirds from other states and Jewish immigrants from Latin America and the Caribbean were quickly making Miami the center of the Sun Belt’s Jewish universe.

At the time, kosher food was hard to come by in South Florida. So, the story goes, Rabbi Korf slaughtered chickens himself and Rebbetizin Rivka salted and soaked them.

One of the couple’s daughters, Leah Jacobson, recalled in an interview [https://www.chabad.org/news/article_cdo/aid/1132205/jewish/Florida-Chabads-Jubilee-Year.htm] published on Chabad.org that the family lived on “a shoestring budget,” and had very little time with their rabbi father, who raised them not to make life decisions based on money. The Korfs ran Shabbat retreats in their home, inviting college students and quizzing the children on their studies, and the kids took a lot of “inner pride” in their father’s mission, Jacobson said.

Mordechai, the seventh of the nine children, studied for the rabbinate in Brooklyn, and at 19, left for Ukraine on a humanitarian mission run by his father’s organization, according to a 2017 article [https://www.miamiherald.com/news/business/biz-monday/article172421852.html] in the Miami Herald. For three years, he learned Russian and navigated the culture of Ukraine, eventually meeting his future business partners.

Laber has been active in Ukraine since at least the early 2000s, and is quoted in a 2001 book by the journalist Larry Tye [https://books.google.com/books?id=P6R1745U870C&pg=PA68&lpg=PA68&dq=uri+%22laber%22&source=bl&ots=9IFpaKXiPR&sig=ACfU3U23JY5aQtZ4roPIQMCgHQT5Uu3LEQ&hl=en&ppis=_e&sa=X&ved=2ahUKEwiq4qyfhdznAhVmh-AKHfobCycQ6AEwEnoECAoQAQ#v=onepage&q=laber&f=false] saying that he was introduced to business partners in Russia by Shmuel Kaminezki, an Israeli who was serving as chief rabbi of an industrial part of Ukraine. (This was a different person from the prominent American Haredi rabbi Shmuel Kamenetsky.)

In 2006, Laber told the Jerusalem Center for Public Affairs that Ukranian Jewish donors expect a “pay-in, pay-out” policy, and that money held in endowments or other stagnant funds in Ukraine would be “abused.” In other words, donors expect to be able to pull money from the pool of funds they help build.

The largest money-laundering scheme in history?

The 2019 lawsuit by PrivatBank’s new owners accuses Korf and Laber of racketeering, conspiracy and fraud in what it and the National Bank of Ukraine report the year before described as a scheme involving hundreds of fraudulent loans, a complicated network of dozens of shell companies in Delaware and elsewhere, metallurgical assets and commercial real-estate transactions in Cleveland.

At the center of the scheme, according to the lawsuit and the report, were two Ukrainian billionaires, Igor Veleryevich Kolomoisky and Gennadiy Borisovich Bogolyubov, who founded PrivatBank in the early 1990s. The lawsuit contends the two made fake loans to their partners, including Korf and Laber, obscured the paths of the loans using their businesses and spent the money to “enrich themselves” from 2006 through 2016.

The NBU — whose responsibilities include ensuring the stability of Ukraine’s currency, licensing banks, inspecting them for compliance and applying corrective measures when they break the law — said that 95% of PrivatBank loans over a decade were issued to parties related to the shareholders. They were either used to pay back other loans, a phenomenon called “loan recycling,” or were woven through a series of transactions to obscure the final use of the loan, often the purchase of real estate or metals processing facilities, the report contends.

The report [https://old.bank.gov.ua/doccatalog/document?id=62483491] describes “a concerted attempt to disguise the true nature of the economic purpose” of the loans from regulators and other stakeholders “for the benefit of the former shareholders.”

To continue reading click here.