Aish Hatorah vs Yaakov Fetman - Good Causes Also Need Vigilance
|Aish Hatorah World Center, Jerusalem|
When Bernie Madoff made off with billions of dollar of Jewish charitable funds, via a too-good-to-be-true investment scam, almost every Jewish good cause was forced to examine its assumptions of trust.
Madoff was an insider, who even sat on boards and investment committees of the same organizations he scammed.
He was also known for his personal philanthropy and generosity.
Madoff's scam victims included Yeshiva University, Hadassah (The Women's Zionist Group of America), Ellie Weisel Foundation, The Wunderkinderen Foundation (of Steven Spielberg), The Chaiss Family Foundation and numerous other leading Jewish non-profit and charitable organizations.
Although Madoff was the largest defrauder of Jewish causes, by a long haul, indeed the largest scam by gentile standards also, he was not the first, nor the last person to take cynical advantage of Jewish good causes.
In the latest example, Yaakov Fetman has been accused by Aish Hatorah of stealing an estimated $20m from the yeshiva, during his 17 years as their trusted CFO. This was also the finding of a Beit Din/Arbitrator, headed by Rabbi Dovid Cohen.
In a court ruling of the Supreme Court, Kings County, issued on 29th September 2014, the arbitration was largely upheld, including the estimate arrived at by Rabbi Cohen of the amounts allegedly pilfered from Aish, by Fetman using various secret bank accounts, scams and illegally taking possession of seven properties allegedly belonging to Aish located in Brooklyn, NY.
Rabbi Greenman of Aish explained to the court:
"The final Award amount of $20,000,000 was based on the limited information we had in our possession which was presented at the Arbitration, which showed at least $2.4 million being stolen or diverted from Aish accounts, over the last six years, between 2007 and 2013, together with approximately $2.5 million in unauthorized and unverified credit card expenditures over the same period. The Arbitrator drew negative inferences against Respondent for his failure to produce documents as directed by the Rabbi's interim psak rulings, together with his failure, under Jewish Law, to account for the legal means with which he claims to have amassed his unexplained net worth, as presented to the Arbitrator, and extrapolated that amount over Fetman's full 17 years of employment at Aish."
The court documents do not explain how Aish Hatorah, an organization with a vintage reputation for good works, professionalism and acting in the Jewish community's interest, took 17 years to catch on to the problem of the missing tens of millions and the ever-increasing net-worth of their CFO.
It is inevitable that senior executives, whether of commercial or non-profit enterprises, are in privileged and entrusted positions, and that they can therefore take advantage and abuse their authority.
Furthermore, practically, it can be extremely awkward for those around these entrusted figures to challenge them, by insisting upon oversight and supervision mechanisms which should avoid abuses of privilege.
The balance of power is invariably in the favour of the senior executive - and whistleblowing is often a high-risk option for those who may be aware of irregularities.
It is just this awkwardness that the unscrupulous can take cynical advantage of.
I have often had occasion to insist that gentlemanly understandings are nevertheless clearly and formally documented, and then been accused of not trusting the person involved. "Don't you trust me?".
This issue can be especially acute in a not-for-profit context, where people are naturally involved in a cause for altruistic reasons, and may even be perceived as saintly. What Rabbi Yanky Horowitz has termed "The Halo Effect".
In such an environment, cutting corners or crossing boundaries, may be considered as good-for-the-cause, and so excused or overlooked.
On the other hand, the resources in question are public - and therefore the need for accountability, transparency and oversight entirely trumps the trust-me card.
The need for rigorous oversight and systematic documentation does not carry with it a specific distrust of anyone.
As the expression goes "Trust AND Validate".