December 21, 2009 | 8:29 pm

Spinka Rebbe gets 2 years for tax fraud

Posted by  Tom Tugend

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Rabbi Naftali Tzvi Weisz, the Brooklyn-based Grand Rebbe of the Spinka sect, was sentenced to two years in federal prison Monday for a decade-long fraud and money-laundering scheme.

Weisz, 61, had pleaded guilty to one count of conspiracy before U.S. District Judge John F. Walter in Los Angeles last August.

Weisz and six associates in Los Angeles, Brooklyn and Israel admitted to participating in a fraudulent kickback scheme in which donors to Spinka charities were refunded up to 95 percent of their donations, while claiming the full amounts as deductions on their income tax.

In 2006, Spinka charities received nearly $8.5 million in donations and made $744,596 in “profits,” after deducting amounts paid back to contributors.

Last year, Moshe Zigelman, the rebbe’s gabbai or assistant, pleaded guilty and also received a two-year prison term.
Spinka is an ultra-Orthodox sect that originated in 19th century Romania and has adherents in Israel, Europe and Brooklyn.

Walter could have sentenced Weisz up to five years in prison, but chose the shorter sentence after concluding that the rabbi did not participate in the scheme to enrich himself personally.

“I am convinced that he never took a penny for himself,” Walter said.

In turn, Weisz told the judge, “I am embarrassed beyond words. My remorse is deep and heartfelt.”

A donor to Spinka charities, who pleaded guilty to using the illegal tax write-off, was sentenced to six months in prison earlier this year. Prosecutors are currently investigating more than 100 other contributors and warned that if they did not come forward voluntarily they might face “significantly higher” sentences.

In a speech last summer in Boro Park, Weisz told thousands of listeners, “We have learned the hard way,” and he urged everyone to follow the law, yeshivaworld.com reported.

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