In Alleged Backroom Deal, Haredim Win Government Support For Haredi Free Loan Societies

The bill would legalize the societies, allowing them to accept and loan funds, but without providing for any regulatory mechanisms or supervision. Critics see this as a way to enable money laundering and other crimes.

Gafni Wins Gov't Support For Free Loan 'Gamahim' Societies
Moti Bassok and Zvi Zrahiya • Ha'aretz

The Ministerial Committee on Legislation yesterday approved a bill to legalize free loan funds, despite the objections of the Finance Ministry and the Bank of Israel.

These funds serve mainly the ultra-orthodox community.

The bill, which was sponsored by Knesset Finance Committee chairman MK Moshe Gafni (United Torah Judaism), would allow free loan funds to operate without Bank of Israel supervision, even though they essentially function as banks.

The societies, called Gamahim in Hebrew - "good deed" societies - provide small interest-free loans to the needy, and are used mostly by the ultra-Orthodox.

The chairman of the ministerial committee, Justice Minister Yaakov Neeman, announced at the start of the session that he supported the bill, but noted that his ministry opposed it.

Finance Minister Yuval Steinitz is in Paris and did not have a representative at the meeting. Steinitz also did not provide the chairman with the treasury's opinion on the issue, as is normally done. Instead, the treasury sent a mid-level official, who said nothing.

A treasury source said the ministry's professional staff, as opposed to the politicians in charge, strongly objects to the bill. The only minister who voted against the bill was Public Security Minister Yitzhak Aharonovitch (Yisrael Beiteinu).

Yesterday, Gafni presented a letter to the committee from Bank of Israel governor Stanley Fischer, dated May 2009. In the letter, Fischer promised Gafni that despite the problematic nature of the proposal, the central bank would cooperate to allow the institutions to exist, while making sure the situation could not be abused.

But immediately after the vote, the Bank of Israel announced that while it "appreciated the importance of free loan societies among the Jewish community for hundreds of years, the Bank of Israel favors a solution within the framework of the law that is consistent with Israeli banking laws."

Gafni told the committee: "The Bank of Israel has promised me a thousand times that it would solve the problem of the free loan societies, since they are problematic in terms of banking and money laundering regulations. My aide has been calling once a week for 10 months to find out how to solve it. I am not willing to have the Bank of Israel continue to tell me, 'It'll work out.'"

But political sources say that what really happened last week is that Prime Minister Benjamin Netanyahu's bureau, Gafni, the Bank of Israel and the treasury struck a deal behind the scenes. Under the deal, Gafni would expedite the Finance Committee's work on the new Bank of Israel bill and finish debating it before the Knesset recesses for the Passover holiday, in return for the passage of the free loan societies bill.

The passage of the new Bank of Israel Law, as Netanyahu has promised Fischer, is what Fischer is said to be waiting for before agreeing to take a second term as central bank governor. His first term ends April 30.

Gafni attacked those accusing him of making a deal: "It is hard being Haredi. I know who leaked the connection between the Bank of Israel Law and the free loan societies law. Good deeds have been transformed into [something disgusting]. They would not dare write that about something that is not Haredi," said Gafni.

Gafni himself strenuously denied there was any deal, saying there was no connection between the two laws.

The banking laws essentially ban free loan societies. The law states: "Anyone who is not a banking corporation may not do business in accepting monetary deposits and providing credit." But the law has never been enforced.

Gafni increased his work on behalf of the societies as the Bank of Israel bill advanced in the Knesset. That bill does not make provisions for free loan societies.

Gafni's bill would legalize the societies, allowing them to accept and loan funds, but without providing for any regulatory mechanisms or supervision, including by the banks supervisor.

Historically the societies lent out small sums to those in need, or to those who needed money for specific occasions such as weddings, births and bar mitzvahs. Over the years the amounts involved have grown, and some societies now lend out quite significant sums.

They raise money from well-off Haredim as well as from the ultra-Orthodox public, sometimes as deposits and sometimes as charitable contributions. They are well-known institutions in the Haredi world and beyond, and sometimes lend to the needy regardless of their level of religious observance.

No one knows the true number of free loan societies, or the amounts involved, But estimates are in the hundreds of millions of shekels, if not more.

Fischer said the problem with the societies was not the charitable contributions, but the deposits, and he said he hoped to find a solution because of the importance of the organizations. Both treasury and central bank officials are worried what would happen if the funds run into liquidity problems, or even bankruptcy. Depositors would be left with no protection and no way to recover their money. In addition, the funds could be used for illegal operations including money laundering, as has happened in the past.

[Hat Tip: Joel Katz.]

Comments

[Chayim]

Like I told all of you that within 8 years Jerusalem will be wall to wall Charedi and all of Israel will see an astonishing growth in Chareidi Jews in every major city. I know what I am talking about and many of the people here be they secular or ex orthodox farbisina types,will see I am correct. The Israeli leadership knows to make way for the new bosses who will be taking over soon. They already hire 100 chareidim into the intelligence division so that the Chareidim will be able to have access in monitoring the arab world as well as many other situations. Slowly we Chareidim will take over and close every college that teaches apikorses like evolution and turn over the building to Yeshivas. CHAREIDI POWER NUMER ONE. JOIN THEM AND SEE THAT IS THE ONLY WAY A JEWS LIFE HAS PURPOSE OTHERWISE YOU ARE A FAILURE.

[in the know]

chayim . charedim orthodoxy is a self destructing religion . dont stand too close or you will get hit really hard in the head and stop drinking that cool aid already .

[:)]

Chayim:
CHAREIDI POWER NUMER ONE. JOIN THEM AND SEE THAT IS THE ONLY WAY A JEWS LIFE HAS PURPOSE OTHERWISE YOU ARE A FAILURE

You are the joke. Lets get this straight, a cult composed of radically bent ultra-orthodox jews, who, up till now are mainly concerned with schnorring and making babies, forming part of the most prestigious intelligence service in the world, as what? Janitors? File clerks? Mossad schnorring service?

Can we say delusions are us?

[Had Enuff]

Chaim Wrote: "They already hire 100 chareidim into the intelligence division so that the Chareidim will be able to have access in monitoring the arab world as well as many other situations"

If, in fact 100 charedim were hired by intelligence, i'd guess that since:

1. No one gives a rats ass what charedim think about the arab world (and other situations ) and...

2. Charedim have to discernable skill set to bring to the intelligence services. Then it stands to reason that...

The only reason they were hired was so that the intelligence services could monitor and infiltrate the charedi community.

[Chayim]

The hundred Charedim were recruited for security purposes not internal chareidi investigations. The Mossad is not involved in Chareidi internal affairs.Chareidim happen to be much more intelligent than most secular people.That because their minds are trained in deep talmudic logic that sharpens their minds. CHAREIDI POWER NUMBER ONE.

[Nigritude Ultramarine]

Slowly we Chareidim will take over and close every college that teaches apikorses like evolution and turn over the building to Yeshivas

Hooray! Universities will be closed and cancer and other diseases will be treated with leeches and bloodletting.

[Nigritude Ultramarine]

That because their minds are trained in deep talmudic logic that sharpens their minds. CHAREIDI POWER NUMBER ONE.

When did bestially become "deep" Talmudic logic?

The sage Abaye did not remain in the field with animals for fear his inclinations would overcome him, and when the sage Rav Chanan visited his colleague Rav Kahana, he saw his friend sitting and learning with an animal in front of him. Rav Chanan asked him: is it not forbidden to be alone with an animal? Rav Kahana answered that he did not notice there was an animal there with him (Kiddushin 81b)

What kind of animal is Rabbi Elyashiv attracted to? How many hours a day does he spend plumbing the depths of this "deep" topic? Does his wife ever get jealous?

[Bill]

NU,

That's some creepy, disgusting Talmudic "wisdom."

I wonder if some hareidi apologist could "enlighten" us about how you've taken this Talmudic pearl "out of context."

BJ? Anyone?

[Abracadabra]

Chayim is a delusional schizophrenic. Just ignore him.

[Chayim]

You see my fellow lansleit,
Once the Chareidim take over the different departments in Israel, many problems will be solved. With the Mossad,Shin Beth,Army,navy,airforce, and all the other departments secure in Chjareidi hands security will be alot tighter. For example all Israeli arabs speak hebrew and thus can easily spy on Israel. Chareidim speak yiddish and can communicate in such a secret way that the arabs could not understand what they are talking about. The Chareidim will focus on TOrah aspects of life which will diffuse the arab anti secular zionistic attitudes. The Chareidim will keep women dressed in Jewish modest values and that will relax the hatred of the arabs towards Israel. The Chareidim will outlaw any gay clubs or parades so that will solve another problem.The screwy Secular Israeli government spent 3 million dollars on overtime to protect 1200 marching gays. This is cold cash that can be used in building housing for the poor. A Chareidi government will close SHABBOS and stay closed friday and sunday as well.This will eliminate American and European pressure on Israel because they will only have 4 days a week to contact Israeli officials plus all Jewish holidays will also be off limits to reachj the governmeent. Plus on days where tachnun is ommited will call for partial closings of government offices that deal with foreighn pressure. On every major rebbes yahrzeit we could leave answering machine messages that the offices are closed. This way Jew haters like Obama would get tired of bugging Israel to stop building extentions on peoples homes. As far as disease there would be hardly any. Air pollution would be drasticly reduced as no cars or factories will be open one sixth of the year due to shabbos and yom tov. Pork would be banned and a law to force all singles to marry will be enforced in major cities.This will eliminate bad night life with clubs that bring violence. All in all crime,drugs,disease etc will be reduced.
Every Jewish kid will remain in yeshiva till marriage. Kids who cant comply will be given a special yeshiva where they will be locked into a comfortable cage and will listen to 14 hours a day tapes by notables like Rabbi Avigdor Miller or Pesach Krone. After they have heard hundreds of tapes they will have their minds clearer. The government will also institute mandatory mussar sessions every year before yom kippur. The night before at midnite all youth must go into fallout shelters and crawl into a wood coffin and listen to 45 minutes of mussar which will be broadcasted by a Rabbi who heads the Department of education. Peoples minds will be clearer. All televisions will play Torah programming so there will be no need for smashing the TV. Colleges will be turned over to yeshivas and all the airheaded professors will leave to Europe for employment in their fiction studies like evolution and greek philosophy. CHAREIDI ISRAEL OUR FUTURE...QUALITY LONG SWEET LIFE... AMEN

[Mikal W. Grass]

Chayim,

If all of Israeli is Charedi, who will support the Yeshivas, transportation, etc., since it seems that nobody will be working?

Mikal

[Dr. Dave]

. Kids who cant comply will be given a special yeshiva where they will be locked into a comfortable cage and will listen to 14 hours a day tapes by notables like Rabbi Avigdor Miller or Pesach Krone. After they have heard hundreds of tapes they will have their minds clearer. The government will also institute mandatory mussar sessions every year before yom kippur. The night before at midnite all youth must go into fallout shelters and crawl into a wood coffin and listen to 45 minutes of mussar which will be broadcasted by a Rabbi who heads the Department of education. Peoples minds will be clearer.

PEOPLE'S MINDS WILL BE CLEARER?????

Chaim, what you are talking about is called torture and brainwashing, and no civilized country would do it to their enemies, let alone their citizens!!!

[:)]

Ok Chayim, now we know for sure that this is a put-on. Shmuck that you are, go away and stop posting. If this is what you envision as a future for Israel you are sadly delusional. Your writings are at the least, extremely childish, and at most nearly perverse.

We know that you live in New York, are not an Israeli citizen, stop this nonsense.

[A. Nuran]

I'm in favor of Haredi-free loans

[Bill]

AN,

LOL