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(photo credit: Channel 1)
A leader of the World Jewish Congress has been barred from financial management duties at the organization after a New York state investigation discovered money-management and record-keeping problems but no criminal activity.
Under a settlement announced Tuesday by State Attorney General Eliot Spitzer's office, Rabbi Israel Singer will no longer be involved in fundraising or financial management at the WJC. Singer had previously stepped down as chairman of the WJC's governing board.
"I sincerely regret that at times my almost exclusive focus on execution of our mission diverted my attention from important administrative activities," Singer said in a written statement.
The WJC promotes Jewish rights and has collected millions of dollars in Holocaust restitution payments on behalf of victims around the globe.
The investigation found Singer had transferred $1.2 million to European bank accounts with the intention of setting up an employee pension fund but did not take steps to ensure the money would be returned to the organization, a news release from Spitzer's office said.
The WJC also inappropriately paid for some employees' personal expenses, including car payments and personal credit card charges, the state audit found. Singer received more than $300,000 in such payments, the release said.
Under the settlement, the New York-based WJC agreed to establish a permanent audit committee and chief financial officer position and computerize all its financial records.
Under the agreement announced by Spitzer's office Tuesday, resolving its investigation of WJC finances, the WJC will formalize reforms undertaken during the investigation meant to enhance the governance and accountability of the WJC and its American affiliate based in New York.
"Today's agreement recognizes the obligation of all charitable organizations - particularly those funded through the donations of members of the public - to safeguard their assets through effective financial oversight and accountability," Spitzer stated.
The attorney-general's investigation began in 2004 amid questions raised by Isi Leibler, outgoing WJC vice president, during a very public confrontation with other WJC officials including Singer and WJC President Edgar Bronfman.
At the time Leibler called for Singer and Bronfman to step down, and accused them of running the WJC like "their own personal fiefdom."
The investigation is detailed in a 34-page Assurance of Discontinuance, also released Tuesday. At the center of the investigation, according to the attorney-general's report, was the unusual transfer of pension funds by the WJC's former secretary-general and governing board chairman Singer totaling $1.2 million.
According to the report, the money was transferred from New York to the WJC's Geneva office between October 2002 and February 2003. In July 2003, Singer arranged for a transfer of the funds from Geneva to an account in London under the custody of Israeli attorney Zvi Barak.
The AG's investigation reported no formal relationship between Barak and the WJC, but noted he was chairman of the pension fund for the Jewish Agency for Israel, one of the WJC's member organizations.
After inquiries by the Geneva office, in August 2004 Barak transferred the money to a designated account at Bank Leumi in New York, the report said. An internal investigation by the WJC cleared Singer of any suspicion.
The attorney-general's investigation failed to substantiate allegations that the transfer of funds was intended for anything other than the creation of a pension fund for Singer and others. Still, the Assurance of Discontinuance states that Singer was "not entirely open with some of his WJC colleagues about the existence of the $1.2 million transferred to Geneva and London," and that in transferring the money without the approval of any governing body of the WJC, Singer "violated his fiduciary duties."
As part of the agreement, Singer must step down from his position and is barred from any holding any fiduciary responsibilities at the WJC and any of its affiliated entities. He will continue to serve in his new role as chairman of the Policy Council. Under this new role, Singer will have no financial oversight or responsibility at the WJC but will focus on diplomacy, programs and policies of the WJC.
The newly formed Policy Council includes former prime minister Shimon Peres and former German foreign minister Joschka Fischer. Former Tel Aviv University president Yoram Dinstein told The Jerusalem Post that while Singer was "never regarded as a good administrator" he is "one of the greatest spokesmen of the Jewish people."
Dinstein helped draft the WJC's new constitution which included measures for a Finance and Budget Committee and an Audit Committee, but hasn't yet fully been adopted.
Leibler lauded Singer's removal from the governing board as a "resounding victory for a Jewish community demanding good governance and accountability."
In a press release, WJC Secretary-General Stephen Herbits announced the organization's decision to initiate legal action against Leibler for what it described as his role in "slanderous claims" that "cost the WJC valuable resources that should have gone to address the needs of the Jewish people."
Leibler called the law suit "a pathetic attempt to divert attention from the seriousness of the findings of the attorney-general."
One WJC official held Leibler responsible for rumors and allegations that accused the WJC of embezzlement and criminal intent that were published during the investigation. "At the end," the official remarked, "it's all personal. It's Isi Leibler fighting against Singer and Bronfman." The wish of the WJC, the official said, "would be to see this as an end point."
Leibler expressed his hope that "after the retirement of the current leaders," the WJC would "once more resume its role as a major spokesman for World Jewry."