Milton Balkany
Encyclopedia
Milton Yehoshua Balkany is an Orthodox
Jewish rabbi
, past director of the Jewish girls′ school Bais Yaakov of Midwood, conservative political activist and fundraiser from Brooklyn, New York, dubbed “the Brooklyn Bundler”.
In November 2010 he was found guilty of extortion
, blackmail
, wire fraud
and making false statements in a Federal Court in Manhattan. On February 18, 2011 he was sentenced to four years in prison.
and his mother worked as a typist. He left public school and went to a local yeshiva
, and later with a scholarship to Torah Vodaath
, a yeshiva in Brooklyn, New York, where he received his rabbinic Ordination in 1970.
. His father in law is Aaron Rubashkin
, a Lubavitcher hasidic Brooklyn butcher and the founder of the now bankrupt slaughterhouse
and meat-packaging factory Agriprocessors
based in Postville, Iowa
.
He has been active in political fundraising mainly for Republican
politicians since the early 1980s. He has also often acted as a lobbyist for various Jewish causes. He became widely known for giving public religious benedictions (Brachot) to senior politicians. He had a seat on the National Republican Senatorial Committee
, and in June 2003, he opened the U.S. Senate and the U.S. House of Representatives with the prayer I “stand here today among the jewels of our nation, men and women who are precious, who radiate dedication, and they have been selected as the leaders of our land.” He once declined an invitation to become the rabbi chaplain to the senate.
Balkany, dubbed “the Brooklyn Bundler”, had a reputation as someone who had access not only to elected officials but to several government agencies as well.
. Department officials later asked for the return of the money to the government.
and Eddie Antar. In 2004, he was banned from making any contact with prison service officials. As part of the deal with prosecutors of the charity fund pilfering scandal he agreed not to lobby on “any matter involving a federal inmate or any other person charged or convicted of a federal crime”. Prosecutors alleged that he would ensure favourable conditions for Jewish prisoners in exchange for money of donations to his charities. After he arranged a brief prison release for Helmsley so that she could visit family members' graves before Yom Kippur
, the billionaire made a contribution to Balkany′s school.
, self-described liberal, and then aide to Senator Daniel Moynihan excommunicated
by a Jewish religious court, blaming him for having “caused yeshivas in the land of Israel to lose money”. Moynihan refused to allow Luchins to attend the hearing.
Balkany told the press that “We have grave concern with a lot of things he is doing in the Jewish community under the auspices of being a senior staff member of Sen. Moynihan's, whenever an issue comes to his attention, he gets involved and does great harm. He's hurting individuals and hurting communities, he thinks he has a direct link to Sinai. I haven't accepted his word as God's word yet.” Luchins responded that “Jewish tradition says that every Jewish soul was at Sinai, and I assume Rabbi Balkany's was there also. We may not have met because he might have been in the back, collecting money.”
In March 1995, a Rabbinic Court met at Yeshiva University at Rabbi Ahron Soloveichik's suggestion to hear Rabbi Balkany's charges against David Luchins. The court, consisting of three highly respected Yeshiva University Roshei Yesiva, dismissed all charges against David Luchins.
interceded on its behalf. Dole had been a beneficiary of Balkany's political fundraising and got involved after the proposal had first been rejected by the U.S. Agency for International Development (AID). The request was in relation to funding to set up computer training programs in Russia, run by the Yeshiva Ohr Torah of Rabbi Shlomo Riskin
, a controversial rabbi in the Israeli occupied West Bank
. Despite the fast-tracking of the payment following a AID meeting with Dole, both Dole and AID denied that there was any excessive influence exacted on the organisation by the then Senate Majority Leader on Balkany's behalf.
Balkany subsequently sued Riskin in a Beit Din for $200,000 over non-payment of fees related to his activism on his behalf. Riskin argued that he had never asked Balkany to intercede with Dole on his behalf and refused to attend the hearings.
by members of Balkany's extended family including the CEO of Agriprocessors
. Harris refused to return the donations organised by Balkany after being made aware of the 2003 prosecution against Balkany and the PETA
investigation into allegations of animal cruelty at Agriprocessors
.
and top-aide Bruce Teitelbaum. According to reports in the Daily News, Balkany helped corral for Orthodox Jewish schools more than half the city's total allocation of vouchers. Balkany offered a full-service operation, charging families a fee to fill out applications for the vouchers, which were in desperate demand all over the city. Nicholas Scoppetta, at the time serving as commissioner for children's services, was sufficiently disturbed by events to refer the matter to the city's Department of Investigation, which opened a probe that was later joined by federal investigators.
Balkany as the President and Director of Bais Yaakov
, a Jewish day school in Brooklyn, applied for, in November 1999, and later received a $700,000 Congressional "Economic Development Initiative" grant administered through the auspices of the United States Department of Housing and Urban Development
. According to the Complaint, he said that the entire grant amount would be used to pay off a mortgage on a building located on the Bais Yaakov property for an entity called "the Children's Center of Brooklyn" to house educational and therapeutic programs for disabled preschool children.
In November 2001, auditors began a preliminary investigation of a number of "Economic Development Initiative" grants that had been awarded in the New York metropolitan area, including the $700,000 "Children's Center" grant. In connection with the investigation, auditors allegedly learned that the "Children's Center" had failed to file any of the regular progress reports required under rules and procedures of the grant. When auditors interviewed Balkany, he insisted the funds had been used to convert a Bais Yaakov building into the "Children's Center" but he refused to provide the auditors with access to the school's books and records, according to the Complaint.
Subsequently, investigators obtained records for the Bais Yaakov account at Chase Manhattan Bank
into which the grant money had been deposited. Those records reflected that all of the money received from HUD in December 1999 had been withdrawn from the account by early February 2000, a two-month period in which Balkany wrote more than 250 checks drawn against the account. According to the Complaint, further investigation revealed that only one check, for approximately $6000, was used to pay down any of the pending mortgages against the Bais Yaakov property, which at the time of the grant totaled more than $1 million.
Balkany diverted the funds to an array of individuals and entities who were not entitled to the earmarked funds. He diverted $300,000 to an Israeli corporation in which his son-in-law was an officer, and another $5,000 to a New York import company run by another son-in-law. He also diverted approximately $80,000 to a variety of other rabbis and Jewish schools and organizations located in Brooklyn. He also wrote out 32 checks against the Bais Yaakov account, totaling approximately $78,000, all made payable to “Rabbi Balkany” which were subsequently endorsed and either cashed or deposited into a personal account at another bank. He also used thousands of dollars in grant funds to pay for personal items such as life insurance premiums; credit card bills and income taxes.
Balkany was charged in the Complaint with theft of government property, filing a false claim, wire fraud and obstruction of justice and released on a bond of $750,000.
In a deal with prosecutors in 2004, Balkany agreed to restrictions on his movement, six months probation, full restitution of the monies and admitted that he was wrong in not complying with specific terms of the grant's use. In return the State Prosecutor's Office promised not to pursue the case.
′s Manhattan office in a conversation recorded by prosecutors, that SAC had inside tips about two companies which make medical devices and a company which makes molecular diagnostic products. An SAC lawyer alerted prosecutors to the extortion attempt, and a prosecutor said during the trial that Balkany “lied” and that there was no evidence of illegal trades. On November 10, 2010, Balkany was found guilty of all charges. On February 18, 2011 he was sentenced to four years in prison. Manhattan federal Judge Denise Cote
called Balkany′s “lack of contrition, remorse and acceptance of responsibility ... profound”, but gave out a sentence that was less than the seven-plus years recommended under federal guidelines, citing Balkany's “lifetime of good works” and the “generosity of spirit” attested to in 87 letters of support. But, considering him a flight risk, she ordered him locked up immediately.
Orthodox Judaism
Orthodox Judaism , is the approach to Judaism which adheres to the traditional interpretation and application of the laws and ethics of the Torah as legislated in the Talmudic texts by the Sanhedrin and subsequently developed and applied by the later authorities known as the Gaonim, Rishonim, and...
Jewish rabbi
Rabbi
In Judaism, a rabbi is a teacher of Torah. This title derives from the Hebrew word רבי , meaning "My Master" , which is the way a student would address a master of Torah...
, past director of the Jewish girls′ school Bais Yaakov of Midwood, conservative political activist and fundraiser from Brooklyn, New York, dubbed “the Brooklyn Bundler”.
In November 2010 he was found guilty of extortion
Extortion
Extortion is a criminal offence which occurs when a person unlawfully obtains either money, property or services from a person, entity, or institution, through coercion. Refraining from doing harm is sometimes euphemistically called protection. Extortion is commonly practiced by organized crime...
, blackmail
Blackmail
In common usage, blackmail is a crime involving threats to reveal substantially true or false information about a person to the public, a family member, or associates unless a demand is met. It may be defined as coercion involving threats of physical harm, threat of criminal prosecution, or threats...
, wire fraud
Wire fraud
Mail and wire fraud is a federal crime in the United States. Together, 18 U.S.C. §§ 1341, 1343, and 1346 reach any fraudulent scheme or artifice to intentionally deprive another of property or honest services with a nexus to mail or wire communication....
and making false statements in a Federal Court in Manhattan. On February 18, 2011 he was sentenced to four years in prison.
Early life
Balkany was born in Detroit, where his father was a stock manager for General MotorsGeneral Motors
General Motors Company , commonly known as GM, formerly incorporated as General Motors Corporation, is an American multinational automotive corporation headquartered in Detroit, Michigan and the world's second-largest automaker in 2010...
and his mother worked as a typist. He left public school and went to a local yeshiva
Yeshiva
Yeshiva is a Jewish educational institution that focuses on the study of traditional religious texts, primarily the Talmud and Torah study. Study is usually done through daily shiurim and in study pairs called chavrutas...
, and later with a scholarship to Torah Vodaath
Yeshiva Torah Vodaas
Yeshiva Torah Vodaas is a yeshiva located in the Kensington neighborhood of Brooklyn, New York.- History :...
, a yeshiva in Brooklyn, New York, where he received his rabbinic Ordination in 1970.
Family
Balkany is married to Sarah Rubashkin with whom he has 13 children. They live in Borough Park, BrooklynBorough Park, Brooklyn
Borough Park , is a neighborhood in the southwestern part of the borough of Brooklyn, in New York City in the United States....
. His father in law is Aaron Rubashkin
Aaron Rubashkin
Abraham Aaron Rubashkin, or Aaron Rubashkin, an ultra-Orthodox Jew of the Lubavitcher hasidic movement born in the Russian town Nevel in the former Soviet Union, is the owner of a kosher butcher shop in Brooklyn, New York, opened in 1953...
, a Lubavitcher hasidic Brooklyn butcher and the founder of the now bankrupt slaughterhouse
Slaughterhouse
A slaughterhouse or abattoir is a facility where animals are killed for consumption as food products.Approximately 45-50% of the animal can be turned into edible products...
and meat-packaging factory Agriprocessors
Agriprocessors
Agriprocessors was the corporate identity of a slaughterhouse and meat-packaging factory based in Postville, Iowa, best known as a facility for the glatt kosher processing of cattle, as well as chicken, turkey, duck, and lamb. Agriprocessors' meat and poultry products were marketed under the brand...
based in Postville, Iowa
Postville, Iowa
Postville is a city in Allamakee and Clayton Counties in the U.S. state of Iowa. It lies near the junction of four counties and at the intersection of U.S. Routes 18 and 52 and Iowa Highway 51, with airport facilities in the neighboring communities of Waukon, Decorah, Monona, and Prairie du Chien....
.
Activities
In August 1970 Balkany founded Bais Yaakov of Brooklyn, now Bais Yaakov of Midwood, a strictly orthodox girls′ school in Borough Park, and serves as its dean.He has been active in political fundraising mainly for Republican
Republican Party (United States)
The Republican Party is one of the two major contemporary political parties in the United States, along with the Democratic Party. Founded by anti-slavery expansion activists in 1854, it is often called the GOP . The party's platform generally reflects American conservatism in the U.S...
politicians since the early 1980s. He has also often acted as a lobbyist for various Jewish causes. He became widely known for giving public religious benedictions (Brachot) to senior politicians. He had a seat on the National Republican Senatorial Committee
National Republican Senatorial Committee
The National Republican Senatorial Committee is the Republican Hill committee for the United States Senate, working to elect Republicans to that body. The NRSC was founded in 1916 as the Republican Senatorial Campaign Committee...
, and in June 2003, he opened the U.S. Senate and the U.S. House of Representatives with the prayer I “stand here today among the jewels of our nation, men and women who are precious, who radiate dedication, and they have been selected as the leaders of our land.” He once declined an invitation to become the rabbi chaplain to the senate.
Balkany, dubbed “the Brooklyn Bundler”, had a reputation as someone who had access not only to elected officials but to several government agencies as well.
Yeshiva Rav Isacshon
In 1987 Balkany became embroiled in a scandal after soliciting politicians to approve a $1.8 million grant from the Department of Health and Human Services to Yeshiva Rav Isacshon to acquire a building in Los AngelesLos Ángeles
Los Ángeles is the capital of the province of Biobío, in the commune of the same name, in Region VIII , in the center-south of Chile. It is located between the Laja and Biobío rivers. The population is 123,445 inhabitants...
. Department officials later asked for the return of the money to the government.
Prison lobbying
Balkany has also lobbied the U.S. Bureau of Prisons to improve conditions for Orthodox Jewish prisoners. According to the Village Voice, several people who have dealt with him say that he has claimed the power to arrange favorable treatment in prison for individuals such as Leona HelmsleyLeona Helmsley
Leona Mindy Roberts Helmsley was an American businesswoman and real estate entrepreneur. She was a flamboyant personality and had a reputation for tyrannical behavior that earned her the nickname Queen of Mean...
and Eddie Antar. In 2004, he was banned from making any contact with prison service officials. As part of the deal with prosecutors of the charity fund pilfering scandal he agreed not to lobby on “any matter involving a federal inmate or any other person charged or convicted of a federal crime”. Prosecutors alleged that he would ensure favourable conditions for Jewish prisoners in exchange for money of donations to his charities. After he arranged a brief prison release for Helmsley so that she could visit family members' graves before Yom Kippur
Yom Kippur
Yom Kippur , also known as Day of Atonement, is the holiest and most solemn day of the year for the Jews. Its central themes are atonement and repentance. Jews traditionally observe this holy day with a 25-hour period of fasting and intensive prayer, often spending most of the day in synagogue...
, the billionaire made a contribution to Balkany′s school.
David Luchins
In 1994 Balkany tried to have David Luchins, an Orthodox Jew, official of the Orthodox UnionOrthodox Union
The Union of Orthodox Jewish Congregations of America , more popularly known as the Orthodox Union , is one of the oldest Orthodox Jewish organizations in the United States. It is best known for its kosher food preparation supervision service...
, self-described liberal, and then aide to Senator Daniel Moynihan excommunicated
Cherem
Cherem , is the highest ecclesiastical censure in the Jewish community. It is the total exclusion of a person from the Jewish community. It is a form of shunning, and is similar to excommunication in the Catholic Church...
by a Jewish religious court, blaming him for having “caused yeshivas in the land of Israel to lose money”. Moynihan refused to allow Luchins to attend the hearing.
Balkany told the press that “We have grave concern with a lot of things he is doing in the Jewish community under the auspices of being a senior staff member of Sen. Moynihan's, whenever an issue comes to his attention, he gets involved and does great harm. He's hurting individuals and hurting communities, he thinks he has a direct link to Sinai. I haven't accepted his word as God's word yet.” Luchins responded that “Jewish tradition says that every Jewish soul was at Sinai, and I assume Rabbi Balkany's was there also. We may not have met because he might have been in the back, collecting money.”
In March 1995, a Rabbinic Court met at Yeshiva University at Rabbi Ahron Soloveichik's suggestion to hear Rabbi Balkany's charges against David Luchins. The court, consisting of three highly respected Yeshiva University Roshei Yesiva, dismissed all charges against David Luchins.
Bob Dole
In 1996 a request for $2.8 million in federal funding for a charitable project Balkany supported was accepted after then-U.S. Senator Bob DoleBob Dole
Robert Joseph "Bob" Dole is an American attorney and politician. Dole represented Kansas in the United States Senate from 1969 to 1996, was Gerald Ford's Vice Presidential running mate in the 1976 presidential election, and was Senate Majority Leader from 1985 to 1987 and in 1995 and 1996...
interceded on its behalf. Dole had been a beneficiary of Balkany's political fundraising and got involved after the proposal had first been rejected by the U.S. Agency for International Development (AID). The request was in relation to funding to set up computer training programs in Russia, run by the Yeshiva Ohr Torah of Rabbi Shlomo Riskin
Shlomo Riskin
Shlomo Riskin is the founding rabbi of Lincoln Square Synagogue on the Upper West Side of New York City, which he led for 12 years; founding chief rabbi of the Israeli settlement of Efrat in the West Bank; dean of Manhattan Day School in New York City; and founder and dean of the Ohr Torah Stone...
, a controversial rabbi in the Israeli occupied West Bank
West Bank
The West Bank ) of the Jordan River is the landlocked geographical eastern part of the Palestinian territories located in Western Asia. To the west, north, and south, the West Bank shares borders with the state of Israel. To the east, across the Jordan River, lies the Hashemite Kingdom of Jordan...
. Despite the fast-tracking of the payment following a AID meeting with Dole, both Dole and AID denied that there was any excessive influence exacted on the organisation by the then Senate Majority Leader on Balkany's behalf.
Balkany subsequently sued Riskin in a Beit Din for $200,000 over non-payment of fees related to his activism on his behalf. Riskin argued that he had never asked Balkany to intercede with Dole on his behalf and refused to attend the hearings.
Katherine Harris
In January 2005, there was some controversy over donations made to Katherine HarrisKatherine Harris
Katherine Harris is an American Republican politician, former Secretary of State of Florida, and former member of the United States House of Representatives. Harris won the 2002 election to represent Florida's 13th congressional district in the U.S. House of Representatives. She held that post...
by members of Balkany's extended family including the CEO of Agriprocessors
Agriprocessors
Agriprocessors was the corporate identity of a slaughterhouse and meat-packaging factory based in Postville, Iowa, best known as a facility for the glatt kosher processing of cattle, as well as chicken, turkey, duck, and lamb. Agriprocessors' meat and poultry products were marketed under the brand...
. Harris refused to return the donations organised by Balkany after being made aware of the 2003 prosecution against Balkany and the PETA
Peta
Peta can refer to:* peta-, an SI prefix denoting a factor of 1015* Peta, Greece, a town in Greece* Peta, the Pāli word for a Preta, or hungry ghost in Buddhism* Peta Wilson, an Australian actress and model* Peta Todd, English glamour model...
investigation into allegations of animal cruelty at Agriprocessors
Agriprocessors
Agriprocessors was the corporate identity of a slaughterhouse and meat-packaging factory based in Postville, Iowa, best known as a facility for the glatt kosher processing of cattle, as well as chicken, turkey, duck, and lamb. Agriprocessors' meat and poultry products were marketed under the brand...
.
Daycare vouchers
Balkany became a key figure in the distribution of day-care vouchers in New York due to his close ties with Rudy GiulianiRudy Giuliani
Rudolph William Louis "Rudy" Giuliani KBE is an American lawyer, businessman, and politician from New York. He served as Mayor of New York City from 1994 to 2001....
and top-aide Bruce Teitelbaum. According to reports in the Daily News, Balkany helped corral for Orthodox Jewish schools more than half the city's total allocation of vouchers. Balkany offered a full-service operation, charging families a fee to fill out applications for the vouchers, which were in desperate demand all over the city. Nicholas Scoppetta, at the time serving as commissioner for children's services, was sufficiently disturbed by events to refer the matter to the city's Department of Investigation, which opened a probe that was later joined by federal investigators.
Misappropriation of charitable funds
On August 26, 2003, the US Attorney for the Southern District of New York, announced that Balkany had been detained on charges that he misappropriated approximately $700,000 in federal grant money.Balkany as the President and Director of Bais Yaakov
Bais Yaakov
Bais Yaakov is a common name for Orthodox full-time Jewish elementary and secondary schools throughout the world for Jewish girls from religious families...
, a Jewish day school in Brooklyn, applied for, in November 1999, and later received a $700,000 Congressional "Economic Development Initiative" grant administered through the auspices of the United States Department of Housing and Urban Development
United States Department of Housing and Urban Development
The United States Department of Housing and Urban Development, also known as HUD, is a Cabinet department in the Executive branch of the United States federal government...
. According to the Complaint, he said that the entire grant amount would be used to pay off a mortgage on a building located on the Bais Yaakov property for an entity called "the Children's Center of Brooklyn" to house educational and therapeutic programs for disabled preschool children.
In November 2001, auditors began a preliminary investigation of a number of "Economic Development Initiative" grants that had been awarded in the New York metropolitan area, including the $700,000 "Children's Center" grant. In connection with the investigation, auditors allegedly learned that the "Children's Center" had failed to file any of the regular progress reports required under rules and procedures of the grant. When auditors interviewed Balkany, he insisted the funds had been used to convert a Bais Yaakov building into the "Children's Center" but he refused to provide the auditors with access to the school's books and records, according to the Complaint.
Subsequently, investigators obtained records for the Bais Yaakov account at Chase Manhattan Bank
Chase Manhattan Bank
JPMorgan Chase Bank, N.A., doing business as Chase, is a national bank that constitutes the consumer and commercial banking subsidiary of financial services firm JPMorgan Chase. The bank was known as Chase Manhattan Bank until it merged with J.P. Morgan & Co. in 2000...
into which the grant money had been deposited. Those records reflected that all of the money received from HUD in December 1999 had been withdrawn from the account by early February 2000, a two-month period in which Balkany wrote more than 250 checks drawn against the account. According to the Complaint, further investigation revealed that only one check, for approximately $6000, was used to pay down any of the pending mortgages against the Bais Yaakov property, which at the time of the grant totaled more than $1 million.
Balkany diverted the funds to an array of individuals and entities who were not entitled to the earmarked funds. He diverted $300,000 to an Israeli corporation in which his son-in-law was an officer, and another $5,000 to a New York import company run by another son-in-law. He also diverted approximately $80,000 to a variety of other rabbis and Jewish schools and organizations located in Brooklyn. He also wrote out 32 checks against the Bais Yaakov account, totaling approximately $78,000, all made payable to “Rabbi Balkany” which were subsequently endorsed and either cashed or deposited into a personal account at another bank. He also used thousands of dollars in grant funds to pay for personal items such as life insurance premiums; credit card bills and income taxes.
Balkany was charged in the Complaint with theft of government property, filing a false claim, wire fraud and obstruction of justice and released on a bond of $750,000.
In a deal with prosecutors in 2004, Balkany agreed to restrictions on his movement, six months probation, full restitution of the monies and admitted that he was wrong in not complying with specific terms of the grant's use. In return the State Prosecutor's Office promised not to pursue the case.
Hedge fund extortion
On February 18, 2010, Balkany was arrested and charged with extortion, blackmail, wire fraud and making false statements in a Federal Court in Manhattan. The hedge fund involved was SAC Capital. Balkany received two checks totalling $3.25 million and was arrested shortly after. The complaint filed reported that he claimed that he could prevent a federal prisoner from telling U.S. authorities about alleged insider trading at the firm. According to court records, Balkany told an investigator with U.S. Attorney Preet BhararaPreet Bharara
Preetinder S. Bharara , commonly known as Preet Bharara, is U.S. Attorney for the Southern District of New York.-Early life and education:Bharara was born in 1968 in Firozpur, Punjab, India, to a Sikh father and Hindu mother...
′s Manhattan office in a conversation recorded by prosecutors, that SAC had inside tips about two companies which make medical devices and a company which makes molecular diagnostic products. An SAC lawyer alerted prosecutors to the extortion attempt, and a prosecutor said during the trial that Balkany “lied” and that there was no evidence of illegal trades. On November 10, 2010, Balkany was found guilty of all charges. On February 18, 2011 he was sentenced to four years in prison. Manhattan federal Judge Denise Cote
Denise Cote
Denise Cote is a United States federal judge on the United States District Court for the Southern District of New York.-Personal and Education:...
called Balkany′s “lack of contrition, remorse and acceptance of responsibility ... profound”, but gave out a sentence that was less than the seven-plus years recommended under federal guidelines, citing Balkany's “lifetime of good works” and the “generosity of spirit” attested to in 87 letters of support. But, considering him a flight risk, she ordered him locked up immediately.