Chabad Refuses To Give Up Names Of Donors, Invokes Clergy Privilege In Rothstein Ponzi Scheme Bankruptcy Case

Chabad was once so connected to Rothstein that its new building on Broward Boulevard carried Rothstein’s name on the outside.

Rothstein Chabad Invokes Clergy Privilege
Paul Brinkmann • South Florida Business Journal

Ponzi schemer Scott W. Rothstein’s former chabad, the Chabad of Downtown Inc. in Fort Lauderdale, is invoking “clergy privilege” in bankruptcy investigations.

Chabad is a term for a Jewish center run by a strictly orthodox Jewish organization.

This particular chabad, run by Rabbi Schneur Kaplan, was once so connected to Rothstein that its new building on Broward Boulevard carried Rothstein’s name on the outside.

Attorneys for Rothstein’s former law firm, led by trustee Herbert Stettin, are trying to determine where the proceeds of Rothstein’s $1.2 billion Ponzi scheme went. One of the groups they want to investigate is the Chabad of Downtown.

Stettin’s investigators have asked the chabad and dozens of other groups and people to sit for depositions or exams in the bankruptcy. In their notices to the bankruptcy court, they include broadly worded requests for records of “any and all communications” between the target and Rothstein.

Stettin’s investigators even asked the chabad to produce a list of everyone who donated to it since 2007.

That was overly broad, the chabad’s attorney, Reggie David Sanger, wrote in a motion for a protective order against the probe.

“Certain communications requested … may also fall within the clergyman penitent privilege applicable under federal law,” Sanger wrote.

Here, I am left wondering: Did Rothstein confess to the rabbi that he was running a Ponzi scheme, or other incriminating evidence? And, why would that matter, because Rothstein has already pleaded guilty.

Regardless, Sanger seems to have a point that the trustee’s request is broad.

U.S. Bankruptcy Judge Raymond Ray has set a hearing on Sanger’s motion for April 7 at 1:30 p.m.

Scott Rothstein Index.

[Hat Tip: CS.]

Comments

[yankele]

While I think Rothstein is an EVIL MAN, I believe that Chabad is doing a GREAT THING invoking clergy privileges.

Lawyers have stripped away victims rights to privacy by requiring psychiatrists and psychologists to turn over notes and evaluations of rape victims. If the courts require clergy to turn over records, then many of our privacy rights are soon sure to follow. Especially since the trustee's request is very broad: "Regardless, Sanger seems to have a point that the trustee’s request is broad."

I am OK with letting one SLIMY, SLEAZY, EVIL man get away if in the long run it protects Many OF OUR civil liberties in the long run.

[harold]

Rothstein donates money to chabad and they are investigating Rothstein and now they want a list of who donated to Chabad, since 2007 yet. That makes no sense.

Are they also asking the list from the Dan Marino foundation, the American Heart Association, the Jewish Federation of Broward, the Boys and Girls clubs of Broward, the Broward Humane Society and the Holy Cross Hospital in Fort Lauderdale. All were recipients of Scott’s donations.

Another fishing expedition.

[state of disgust]

Given Chabad's history, the Feds may be fishing in very rich waters.
Since the Feds seem not to be able to track much of the money stolen in this Ponzi scheme it is a reasonable request to make of "Chabad of Downtown" in the hope/expectation of discovering if Chabad is sheltering Rothstein's ill-gotten money.
If they have nothing to hide, what are they worried about?

[harold]

Given Chabad's history

What history? I first of all thought someone is inocent until proven guilty so a presumption of guilt is a no-no and like it or not, smacks of Anti-Semitism (Oh No the A.S. word), so unless they investigate all the recipients of his donations they are very thin ice.

[harold]

they are very thin ice

i.e. "they are on very thin ice".

[HadEnuff]

It only took Harold just over 2 hours from the articles time stamp to claim anti-semitism.

If Chabad claims tax-exempt status, they should have to open their books.

And if Harold claims right-to-post status, he should have to open his mind!

[effie]

They're nuts. What's protected is: a communication made in confidence in the presence of no 3rd party, to a member of the clergy, who is authorized to hear those communications and, under the discipline or tenets of his or her church, denomination, or organization, has a duty to keep those communications secret.

[harold]

It only took Harold just over 2 hours from the articles time stamp to claim anti-semitism

Just love it how easy it is to push the FailedMessainites buttons - as my "(Oh No the A.S. word)" comment suggested. Would it sound better if I said "Anti-Chabad". The point being that they are being singled out from the other recipients to have to open their books, a sign of presumption of guilt or a sign of bias. Both are not acceptable.

[HadEnuff]

Harold wrote: "The point being that they are being singled out from the other recipients to have to open their books, a sign of presumption of guilt or a sign of bias"

Unfortunately for Harold, the article said that only: "One of the groups they want to investigate is the Chabad of Downtown.

Stettin's investigators have asked the chabad and dozens of other groups and people to sit for depositions or exams in the bankruptcy. In their notices to the bankruptcy court, they include broadly worded requests for records of "any and all communications" between the target and Rothstein.
"

Hmmm I don't see Chabad being singled out or treated any differently than any of the "dozens" of organizations or individuals.

So Harold... explain to the world how this constitutes being anti=semetic or anti-chabad?

[harold]

Hmmm I don't see Chabad being singled out or treated any differently than any of the "dozens" of organizations or individuals.

So Harold... explain to the world how this constitutes being anti=semetic or anti-chabad?

You are right I did not see that paragraph. I quickly skimmed over the article and didn't remember seeing any other organizations mentioned by name so I assumed that this was a witch hunt against Chabad only.

I therefore retract and have no problems as long as they apply the same criteria equally i.e. for example to see a list of all donors since 2007 for the American Heart Association.

[Judah]

It is an invitation for Chabad to screw up, big time. They may already HAVE documentary evidence against Chabad and are waiting to see if they lie. It is criminal to lie to federal investigators, so if they are scamming in order to keep the money, they had better be careful. This isn't as simple as scamming some welfare department or school district.

[seymour]

I agree what the feds are asking for is too broad and anyway they are investigating Rothstein not chabad

[A E ANDERSON]

This is silliest thing I've ever heard. The lists of donors for any 501 not-for-profit must be filled an annual informational return (Form 990) with the Internal Revenue Service. There's no clergy privilege, and an organisation's continued exempt tax status depends on the continued annual compliance with the reporting requirements.

[harold]

This is silliest thing I've ever heard. The lists of donors for any 501 not-for-profit must be filled an annual informational return (Form 990) with the Internal Revenue Service

So what you are saying that all they have to do is ask the IRS for the 990 filing from Chabad.

[rebitzman]

"Chabad Refuses To Give Up Names Of Donors, Invokes Clergy Privilege In Rothstein Ponzi Scheme Bankruptcy Case"

Well YEAH - if they admitted it was stolen, they would have to reject it or give it back.

Better for the bottom line to remain ignorant.