Blackmailing Brooklyn Rabbi Loses Appeal

Sholom Rubashkin's brother-in-law, Rabbi Milton Yehoshua Balkany lost the appeal of his extortion, blackmail, and wire fraud conviction.

'Shakedown' rabbi loses appeal
By BRUCE GOLDING • New York Post

This holy man never had a prayer at beating the rap.

A Manhattan appeals court today upheld the conviction of a crooked Brooklyn rabbi for trying to shake down billionaire Steve Cohen's hedge fund with phony allegations of inside trading.

The U.S. Second Circuit Court of Appeals unanimously rejected Rabbi Milton Balkany's claim that jurors should have been allowed to consider if he was entrapped, saying "Balkany failed to present any evidence that the government 'induced' him to commit the crimes charged."

"As the government notes, the evidence with respect to the extortion, wire fraud and blackmail counts established that it was Balkany who made the first unsolicited call to SAC (Capital Advisers), claiming that he had damaging information that Cohen had engaged in insider trading which he urgently wanted to share," the ruling says.

The unsigned decision by Judges Amalya Kearse, John Walker Jr. and Gerard Lynch also shot down Balkany's argument that he was convicted of making a false statement through a "perjury trap" set by the feds, noting that "Balkany was under no obligation to speak to the federal investigator to whom he lied."

Balkany, 65, is currently serving four years in a federal slammer in Miami for trying to scam $4 million in donations to his financially strapped Bais Yaakov Jewish girls school.

Defense lawyer Paul Shechtman said, "Rabbi Balkany accepts the court's ruling."

"A good man -- a distinguished educator -- exercised poor judgment and is now paying a heavy price," he added.

Bloomberg Businessweek reports:

SAC Extortion Case Conviction of Brooklyn Rabbi Is Upheld
By Patricia Hurtado - Bloomberg

A federal appeals court upheld the conviction of Milton Balkany, a Brooklyn, New York, rabbi found guilty of trying to extort $4 million from Steven Cohen’s SAC Capital Advisors LP.

The U.S. Court of Appeals in Manhattan today rejected Balkany’s claim that he was induced to commit the crime by the firm’s lawyer, Martin Klotz, and was barred from putting on a defense that he had been entrapped by the lawyer working on behalf of prosecutors.

Balkany was convicted of extortion and blackmail by a jury in November 2010 for threatening to disclose insider trading by SAC unless $4 million was paid to charities he operated. There was no evidence at the trial that he had any such evidence. He was sentenced to four years in prison.

“The District Court did not err in refusing to give an entrapment charge because Balkany failed to present any evidence that the government ‘induced’ him to commit the crimes charged,” a panel of judges on the Manhattan-based appeals said today.

“The evidence with respect to the extortion, wire fraud, and blackmail counts established that it was Balkany who first made an unsolicited call to SAC,” the panel said.

Paul Shechtman, a lawyer for Balkany, didn’t immediately reply to a voice-mail message left at his office seeking comment on the decision. Jonathan Gasthalter, a spokesman for SAC, declined to comment.

Day School Dean

Prosecutors said the rabbi, who was dean of the Bais Yaakov day school in the Borough Park neighborhood of Brooklyn, told the Stamford, Connecticut-based fund that a federal prisoner in Otisville, New York, to whom he was a spiritual adviser, had described the purported insider-trading scheme to him.

Balkany called prosecutors in the Manhattan U.S. Attorney’s Office in an attempt to put pressure on SAC to further his scheme and cause prosecutors to interview the prisoner, testimony showed.

Witnesses testified that Balkany told the lawyer for SAC that the inmate would keep quiet about illegal in 2004 and 2005 if it paid his school and another $2 million each.

Klotz instead recorded his phone calls and meetings with Balkany, who was arrested after taking two checks from SAC totaling $3.25 million.

Balkany told an SAC official at the time that the inmate wouldn’t talk to authorities at a meeting scheduled for the following day. No such meeting was planned, according to the government.

The case is U.S. v. Balkany, 10-cr-441, U.S. District Court, Southern District of New York (Manhattan).

[Hat Tip: Ruthie.]

Comments

[BigBucks]

Never start up with a billionaire, you will always lose.

[Garnel Ironheart]

Well here comes another round of "urgent" pidyon shevyim appeals.

[ruthie]

bigbucks....
thanks for the advice....

rabbi balkany has been doing this for quite some time...this time he got caught...
you're probably right

[WoolSilkCotton, rock star and sports superstar]

Hooray! Another crook enters the Otisville Yeshiva.

[Sprintzy]

He is not in Otisville. He is in Miami.

[Yochanan Lavie songwriter extraordinaire]

Looses appeal? He never had any appeal to begin with. (humor).

[R.W.]

Looses appeal? He never had any appeal to begin with. (humor).

It's so obvious you're jealous of that hamburg.

[Apple]

Serious? was he comvicted, or you're a comic? conic, rather.

[Anonymous]

Without getting everybody here worked up, and in no way defending what he did, and in no way justifying illegal behavior regardless of the motive, can I ask this:

Was it ever alleged, much less proven, that Balkany did this for any personal gain? I'm not talking about reputational gain and such. Just the money.

Is there even a suggestion that he did this for some kind of payback, or was he completely trying to help the schools?

Is it possible to give him some credit for trying to help these schools even if he was 100% wrong for the way he did it?

Mature responses, please.

[WoolSilkCotton, rock star and sports superstar]

It's a Homburg, not a Hamburg.

http://www.lockhatters.co.uk/Homburg-details.aspx

Anonymous, his lawyers tried all that bullshit. Guess what, no dice.
Get used to it- he is frum, a shameless crook, and on his way to prison.

[ruthie]

anonymous...
here's a mature response: yes (without going into details) yes
yes yes yes yes yes..
the schools were a cover.
he has lots of kids. and he gave them all huge sums of money.
he meant well.
?

[seymour]

Posted by: Anonymous | March 19, 2012 at 05:13 PM

this is not the first scam he ran, he ran another one that did a enriched his family

Just do a simple search on this web site

[seymour]

Get used to it- he is frum, a shameless crook, and on his way to prison.

Posted by: WoolSilkCotton, rock star and sports superstar | March 19, 2012 at 05:22 PM

maybe you are not getting it or you are thick (lol)

to him and many frum people they will say he is a tzaddiuk since according to halacha (their version) he did nothing wrong therefore he is not a crook at all and he does not need to be ashamed

nebech he needed to put food on the table

[Yochanan Lavie songwriter extraordinaire]

RW: Yeah, that Homburg is swag!

[Rochel]

My, my what a crooked clan this Rubashkin clan is!! Unbelievable! Father and son in Postville, son-in-law is a sex offender in Albany, now this! And this is what Chabad is holding up as a model, pious family??

[WoolSilkCotton, rock star and sports superstar]

Seymour, you are right. What was I thinking. To the frumma, there is no such thing as stealing.

I remember when Balkany stole $700,000 from government grants for his school, put them in his personal Israeli bank account, and when he got caught he got a sweet plea deal where he only had to give back the money. He laughed in the prosecutor's face. Don't think they forgot that little episode. Now who has the last laugh?

[Bangkok]

WSC: I prefer my Homburgers with fried onions and special sauce.

[Bangkok]

Well here comes another round of "urgent" pidyon shevyim appeals.

Posted by: Garnel Ironheart | March 19, 2012 at 03:25 PM

LOL

[R.W.]

It's a Homburg, not a Hamburg.

Yes, but not where Balkany shops.

http://harmonyonstage.com/hats/hats.html

[Abracadabra]

Is there even a suggestion that he did this for some kind of payback, or was he completely trying to help the schools?

Did he draw a salary from the school? Did any of his children or grandchildren draw a salary from the school? I'm sure the answer is yes. If so, then he benefited from the fraud.

But either way, lying, cheating and stealing is not a way to help a school. If the school is bankrupt you can fundraise legally or close shop and call it a day. Where are the schools now that they don't have Balkany's ill-gotten $4-million? If they closed then somehow, the world is still turning. Torah is NOT an excuse for illegal behavior. If you have too many kids and can't pay tuition, use birth control or send your kids to public school. Don't lie, cheat and steal and then hide behind Torah schools. That makes the lying, cheating and stealing a Chillul Hashem - which incidently happens to be a D'oraiysa - for the edification of those who pretend to care about Torah.

[reuven s]

lower than pond scum ;;lowest form of life didnt pay teachers for the longest time....have fun in prison with those health benefits youll be needing

[ruthie]

ha...that so figures he didn't pay the noble teachers

[seymour]

Posted by: Rochel | March 19, 2012 at 05:38 PM

it truly is mind boggling

unless according to them he did nothing wrong

[adams]

is he going to preach in Jail, he is quite the Orator, or he could put them to sleep.

[Chicago Sam]

Don't you wish everyone was frum? NOT!

I am sure Bubba would love to listen to his sermons. Now, if we can throw the rest of the crooked Haredim with him, maybe anti-Semites might leave us alone for a change.

[Emanuel]

I am always fascinated how much people here entertains themselves with the fall of someone else, it's like a sport for some folks.

This man did a crime, I am sure he will do his time under the rule of law.

[A. Nuran]

Anonymous, who the hell cares?
He's a career criminal. He committed multiple felonies. It doesn't matter what he wanted to do with the money. He's a fucking menace to society who needs to be locked up.

If he were Black you'd be all about how evil he is. But since he's got a beard, a black hat and a bobbed dick you're trying to find excuses.

[Sol]

Rabbi Balkany is still a great guy in my opinion!! I know of some unbelievable Chesed he did over the years!! His doors were always open to the lost poor and needy!! His Kindness surely outweighs his mistakes!! May Hashem watch over him like he watched over his guest at his Pesach Sedorim year in year out!!

[Mendel Mendel]

To Sol:
Stop this madness of called crooked behavior a "mistake". Extortion is not a mistake; it is a crime. Period. I am tired of hearing this "mistake" crap every time a frum guy gets caught after having done a white collar crime. The Spinka rebbe's actions were also a CRIME, not a "mistake". Etc. etc. etc.

[Lo K'darkah]

I am amazed that anyone would even begin to think that a mitzvah haba'ah b'aveirah excuse is a morally acceptable argument. If you cheat and lie in order to fund Torah institutions, it doesn't make it better, it makes it WORSE. I don't know Balkany personally but I hope he has time over the next couple of years to reflect on his attitude towards the Jewish People. The worship of mammon in the name of "yiddishkeit" is destroying us. We need a new type of hero - one who doesn't dance around the golden calf. If Balkany converts to another religion in prison (such as Judaism) he'll be doing himself and a lot of other people a favour.

[ruthie]

balkany's daughter is one of the nicest people i have ever met.
she had so much money....vacations, clothes etc. etc. etc. etc.
her father is a crook. she invited me to her wedding. i didn't go because i thought her father was a jerk way back then.
on the other hand, what bullshit...of course he was nice sol...giving people money, inviting them for pesach...THAT WAS HIS WAY OF MAKING IT UP TO G-D IN THAT FUCKED UP HEAD of his.
where is he now?

[ruthie]

ha....
the one thing balkany did not get for himself while tripping over himself for more money...was a kick ass lawyer!
ha....lawyer would have advised him...hey rabbi...that's a crime.
but balkany didn't spring for a lawyer. STUUUPID

[seymour]

Posted by: ruthie | March 20, 2012 at 03:50 AM

maybe he asked a rebbie and got a hetar to do it

[CpA]

Too bad the cops keep catching this guy when the biggest crook ever to use the name bais yaakov keeps sliming by them and now runs Kuzrack's bais din.

[njprincess]

One answer to anonymous that hasn't been noted:
Even if there WAS some heter to steal/extort in the name of funding Torah schools and educators, would not that stealing and or extortion have to be in some way OTHER than a method that involves MESIRAH??? Nobody seems to notice that he was directly threatening another jew (even if S Cohen/Klotz aren't (!) surely somebody who would have been implicated in the insider trading scandal was.... What is most unbelievable about this story (and there is a lot that just boggles the mind) is that a Rabbi from a community that forbids going to the suthorities for anything - even when ......(you know where i'm going with this...) would go to the authorities for anything at all, esp for MONEY? Wonder which Rabbi (and I'm sure he went to a Rabbi for permission before the call to the prosecutor's office because we well know how important it is to go to a Rabbi)gave him the heter.

[ruthie]

seymour,
good point but still stupid of him. c'mon

[Sol]

Mendel, Ruthie. We can both agree to disagree!! He was always a big Machnas Orech!! His Shabbos table ALWAYS had full of Broken souls seated around it! We can still learn from all his Chesed! He still deserves credit where its due!! Common Ruthie, go look for a few people to invite to your Seder (that have nowhere to go) instead of arguing with me!! I can proudly say that I have 2 guest so far and some more coming!! I learnt this from people like Rabbi Balkany!

[rebeljew]

Is it possible to give him some credit for trying to help these schools even if he was 100% wrong for the way he did it?

Mitzvah Habah al y'dai aveirah, aino mitzvah.
Lulav ganuv, ain l'yotze y'dai chovaso bo, v'afilu achar yi'ush.

[Anonymous]

I used to see Balkany daven in Munkatch and cannot believe that this is the same person here.