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From wire services: December 23rd, 1997:

New York Rabbis Convicted of Laundering Cash for Drug Dealers


NEW YORK - Two rabbis and another Jew pleaded guilty to money-laundering charges for funneling more than $3 million in Colombian cocaine proceeds through a Brooklyn synagogue and yeshiva.

The perpetrators were charged with being part of a group of Orthodox Jews who laundered the $3.5 million from Colombian and Dominican drug dealers in 1995 and 1996.

By channeling the drug money through the Eitz Chaim synagogue and a Jewish school, the Bobover Yeshiva, as well as another Jewish institution, the Chaim Shel Shulem, all located in the heavily Orthodox Jewish Borough Park section of Brooklyn, they were able to move the money to Swiss bank accounts and then back to the dealers.

Rabbi Mahir Reiss, 47, and his brother Abraham Reiss, 48, pleaded guilty in Brooklyn federal court. Rabbi Reiss faces up to four years in prison, while Abraham Reiss faces three years.

The men, who will be sentenced in March, agreed to give up $1 million hidden in bank and stock accounts.

In one incident , the defendants wired $2.4 million through their Swiss bank account to pay for an airplane. The plane was eventually delivered to the Colombian drug cartel.

Another rabbi, Bernard Grunfeld, 67, pleaded guilty to "structuring," a legal term for breaking up bank transactions into amounts of less than $10,000 to avoid detection by federal authorities, as part of the conspiracy that laundered the cash. Rabbi Grunfeld faces two years in prison and a $100,000 cash forfeiture.

Another alleged member of the scheme, former Yeshiva student Israel Knobloch, is due to go to trial on similar charges in the spring. Another suspect, Jack Pinksi, a relative of Rabbi Reiss, is a fugitive. Five Latin American drug dealers who were the Jews' partners have also submitted guilty pleas and face four years in prison and deportation.

The Jews had received a 15% commission from a Columbian cartel for all drug money which they managed to launder through the accounts of the Jewish school and synagogue in New York.

The New York Times ignored the preceding story, failing to publish it in either its Dec. 23 or Dec. 24 editions. 


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