Chabad charities that some allege were used to siphon millions of dollars out of Agriprocessors and to the Rubashkin family to avoid their loss during a possible bankruptcy filing have agreed to repay pennies on the dollars they were given by Agriprocessors when it was insolvent.
Charities that got millions in donations from Agriprocessors to repay thousands
JEFF REINITZ • Waterloo-Cedar Falls Courier
POSTVILLE – Charities that received millions of dollars in donations from Agriprocessors before it declared bankruptcy are paying some of the money back.
On Wednesday, the trustee handling the now-defunct kosher meatpacker's Chapter 7 case announced a settlement with Colel Chabad, the longest-running charity in Israel.
Colel Chabad received more than $4 million from Agriprocessors in the two years before the company's bankruptcy, according to court records. The trustee said the company received nothing of value for the money --- which included 64 payments ranging between $1,445 and $200,000 --- and the payments were made when Agriprocessors was insolvent.
The trustee made the claim seeking repayment in November 2011, and the charity raised defenses that the trustee said would make it unlikely the trustee would recover a signification part of the money through litigation.
On Wednesday, the trustee filed papers stating two sides agreed to a $50,000 settlement.
The trustee said the agreement is in the best interest of the estate given the facts.
The settlement is pending court approval.
Colel Chabad is a non-profit organization that runs soup kitchens and medical clinics and offers services to widows and orphans. It also has an immigrant aid program.
In December, the trustee announced a settlement with the charity Bet Kahila-Eighth Degree for $82,000. The organization had received $2.89 million from Agriprocessors.
The trustee is also seeking repayment from other charities, including the Torah Education Program of Northeast Iowa, which allegedly received $11 million, court records state.
Agriprocessors filed for bankruptcy in 2008 following an immigration raid. Former company vice president Sholom Rubashkin is currently serving time for federal financial charges.
All of these are Chabad-linked charities. Colel Chabad is run by a cousin of Rubashkin's. Bet Kahila is Chabad Rabbi Asher Zeilingold whose Untited Mehadrin Kosher was one of Agriprocessors kosher supervisors. The Torah Education Program of Northeast Iowa was controlled by Sholom Rubashkin himself.
Update 3:58 pm CDT – The AP reports:
…His hands and feet shackled, Hosam Amara walked slowly into the federal courtroom in Cedar Rapids. Bald, short and stocky, the 48-year-old former poultry production manager at the Agriprocessors plant in Postville wore an orange jailhouse jumpsuit and a stone-faced demeanor.
Amara pleaded not guilty to an indictment charging him with conspiring to harbor workers who were in the country illegally and conspiring to provide false immigration papers at what was the nation's largest kosher slaughterhouse. He faces 25 counts related to harboring and two counts related to document fraud.
Amara was ordered jailed pending a trial scheduled for July 1 after assistant U.S. Attorney Peter Deegan said the government considered him a flight risk.…
Prosecutors say Amara managed the second shift on the poultry side of the plant, exercising "substantial control" over production and working as a lieutenant of Agriprocessors vice president Sholom Rubashkin, whose family owned the company.
Prosecutors say Amara knowingly employed immigrants who were not in the country legally but helped keep them off the books by putting them on the payroll of a separate company. They say he allowed employees to obtain and use Social Security and green cards that he knew were false.
In addition to Amara, the indictment charged Rubashkin and former plant managers Brent Beebe and Zeev Levi with taking part in the conspiracy.
Prosecutors say that Levi has also apparently fled to Israel and remains a fugitive. Beebe reached a plea agreement in 2010 in which he pleaded guilty to a document fraud charge and was sentenced to 10 months in prison.
Rubashkin was convicted in 2009 on separate financial fraud charges and sentenced to 27 years in prison. After his conviction in that case, prosecutors dropped the immigration charges against him rather than go through with a second trial.…