Rabbis accused of laundering drug money through synagogue, yeshiva
NEW YORK (AP) _ Two Orthodox rabbis and 10 others laundered $750,000 in drug profits through a yeshiva and synagogue for Colombian dealers, federal prosecutors said Tuesday.
``Money launderers are the indispensable partners of major drug traffickers,″ U.S. Attorney Zachary W. Carter said in a statement. ``The cynical act of using religious institutions to conceal drug proceeds is particularly reprehensible.″
Rabbis Mahir Reiss, 47, and Bernard Grunfeld, 67, were each released Tuesday on $750,000 bond secured by property. Reiss’ lawyer, Susan Kellman, said the complaint ``is filled with a variety of gross distortions.″
Grunfeld’s lawyer, Benjamin Rosenberg, declined comment.
The rabbis conspired with 10 other people to launder $750,000 in profits from Colombian drug dealers, according to the complaint signed by Howard Campbell, a special agent with the Drug Enforcement Administration. They sifted cash through the bank accounts of Congregation Eitz Chaim and Bobover Yeshiva, both in Brooklyn, he wrote.
Campbell said they even used some of the laundered money to buy a Beech Super King plane, the kind often used by drug traffickers to smuggle narcotics from Colombia to the United States.
At one point, Reiss helped transfer $2.4 million from a Swiss bank account to pay for the plane, which was flown in November 1994 from Florida to drug traffickers in Colombia, prosecutors said.
The rabbis and another go-between took between 12 percent and 15 percent of the laundered money as payment, the complaint said.
Assistant U.S. Attorney Lee G. Dunst said prosecutors were looking at an additional $1 million that went through bank accounts of various religious organizations in Brooklyn that has not yet been linked to drug dealers.
Prosecutors said that as president of the congregation and an officer of the yeshiva, Grunfeld had access to bank accounts for both.
The charges came out of a 3-year-old probe by the DEA and the Internal Revenue Service into drug money laundering operations in Brooklyn, Manhattan and Long Island.
The complaint alleges the rabbis authorized about 95 cash withdrawals and deposits in various bank accounts between $9,000 and $9,999 from September 1994 and February 1997. Cash transactions of more than $10,000 must be reported to the government.
There also was more than $19 million deposited into accounts controlled by the rabbis during a 10-month period ending in May 1996, the complaint said.
The complaint said the rabbis worked directly with at least one drug trafficker.
``These individuals covered themselves with the cloak of legitimacy, namely religious institutions, to launder the illicit profits of major drug traffickers,″ said Donald E. Wanick, chief of the IRS’ Criminal Investigation Division. ``Because of their greed, these individuals share the responsibility for the continuing drug problem in this country.″
An eight-count indictment handed up late Tuesday by a federal grand jury in Brooklyn contained various money laundering and conspiracy charges.
If convicted, Reiss and Grunfeld face a maximum of 20 years in prison and $1.5 million in fines.
Others arrested include five drug traffickers in New York, three people who carried cash between destinations, and four men with links to the Orthodox Jewish community, authorities said.