Religious News - Banker admits fraud, rabbi to follow

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Banker admits fraud, rabbi to follow

An Israeli banker has pleaded guilty to a tax fraud conspiracy charge in Los Angeles and a New York rabbi is to follow suit, federal prosecutors said.

Joseph Roth, 66, of Tel Aviv, who worked for United Mizrahi Bank, pleaded guilty Friday to the federal conspiracy charge, admitting he was part of a scheme to defraud the U.S. government out of millions of dollars in tax revenues by setting up secret bank accounts in Israel for bogus trusts, prosecutors said.

Rabbi Moshe E. Zigelman, 60, of New York has agreed to plead guilty to conspiracy at a hearing set for Tuesday. Under the deal announced Friday, Zigelman acknowledges his role in the decade-long scheme.

The accounts involved "charitable contributions" to organizations set up under Spinka, an orthodox Jewish group that refunded most of the money back to "contributors," authorities said. The contributions to Spinka-related entities totaled $8.5 million in 2006 alone, of which $7.75 million was returned to contributors.

The two defendants are among eight individuals -- including Naftali Tzi Weisz, the grand rabbi of Spinka -- and five charitable entities indicted last year.

The remaining defendants face trial Sept. 9 and Roth is to be sentenced Oct.20.

Copyright 2008 by United Press International.

This news arrived on: 06/30/2008

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