Russian Money Churning Has a Familiar Connection

By Lucille Barnes

We started looking for an Israeli connection the moment we first read about the apparent laundering of tens of billions of dollars, possibly including U.S. foreign aid and World Bank loans, into private bank accounts by Russian government officials, Russian Mafia members, or both through two American women married to Russians and employed by the Bank of New York. Lucy Edwards, 41, who is married to Peter Berlin, Russian-born director of Benex World-Wide, which moved the Russian funds through the Bank of New York and the Bank of New York-Inter Maritime, was suspended. She reported to Natasha Gurfinkel Kagalovsky, 44, who also was suspended, and whose husband, Konstantin Kagalovsky, was a senior executive of Bank Menatep, formerly one of Russia’s largest financial institutions, which now is nearly insolvent.

And what did both Bank New York-Inter Maritime and Bank Menatep have in common? Haifa-born (to Russian Jewish parents) Bruce Rappaport, who owns the former bank and has had extensive dealings with the latter bank, according to an article in the Aug. 23 New York Times. Back in 1988 Rappaport was described in The Washington Post as “a big man in Israel.” That’s when he was involved in a protection scheme, later labeled “Iraqgate”, with then-Israeli Prime Minister Shimon Peres, allegedly involving payments to Israel’s Labor party in exchange for guarantees that Israel would not shell a pipeline to transport Iraqi oil to Jordan’s port of Aqaba if Iraqi President Saddam Hussain decided to build it. The abortive scheme got both President Ronald Reagan’s Attorney General Ed Meese and Meese’s long-time friend and business associate E. Bob Wallach investigated by a special prosecutor.

And going back still further to “Irangate,” perhaps you’ll remember how Reagan administration assistant secretary of state for Latin American Affairs Elliot Abrams had solicited a huge contribution for the Nicaraguan Contras, who were barred by law from receiving U.S. taxpayer assistance. But then Abrams, or perhaps national security adviser Robert (Bud) McFarlane or his assistant, Oliver North, somehow inadvertently transposed some numbers and the contribution from the Sultan of Brunei was deposited into the bank account of a “Swiss businessman” by mistake. The lucky businessman just happened to be Bruce Rappaport, who later returned the money after he or someone had had the use of it for a year or so. We expect there’s more of interest about what this fortunate guy might be doing with the big money that just seems to fall into his lap, but we doubt that you’ll be reading about it in the mainstream U.S. media since he’s considered, according to another source quoted in the Post, “extremely litigious [and] doesn’t hesitate to sue.” We’ll limit ourselves to mentioning only that another Post source said Rappaport “has a monumental ego that he keeps pumped up by contributing to Israel...He visits there several times a year. He’s got a lot of influence.” And maybe a lot of converted Russian rubles.

And by the way, Elliot Abrams is the son-in-law of Midge Decter and Norman Podhoretz, Likud-lining defender of Israel and “neo-conservative” former editor-in-chief of Commentary magazine, published by the American Jewish Committee, which presently is engaged in the impossible task of trying to prove that Columbia University Professor Edward Said, America’s best known Palestinian, isn’t a Palestinian (see Dr. Said’s article on p. 46). Maybe it’s because neocons really believed the late Israeli Prime Minister Golda Meir when she famously, and fatuously, claimed that “Palestinians didn’t exist.” But you knew all that.

And speaking of litigious personalities, pro-Israel self-described “terrorism expert” Steven Emerson, producer of the 1994 film “Jihad in America,” which set back Muslim-Christian relations in the U.S. a generation or so, almost was on the receiving end of some litigation. He was forced to retract allegations he made last year about Reese Erlich, a free-lance journalist and former journalism lecturer at California State University in Hayward, CA, who had remarked in a radio commentary on “Jihad in America” that “rather than illuminating a serious issue, the documentary uses McCarthyite techniques to attack a range of legal political and religious groups.” In a pamphlet in which Emerson labeled his critics “conspiratorialists, terrorist apologists, ultra right-wing extremists and anti-Semites” (Erlich is Jewish, but never mind), Emerson had said that Erlich’s “commentary about ‘Jihad in America’ is about as relevant as quoting David Duke as an objective source on civil rights.”

When Erlich’s attorney threatened to take Emerson to court over “the irresponsible and ad hominem nature of your unsupported attacks,” Emerson retracted in an Aug. 2 letter in which he said, “I recognize my statement about you in this material was incorrect and mischaracterized your past activities.” In an out-of-court settlement Emerson also agreed to pay Erlich $3,000.

None of this bodes well for Emerson’s own multimillion-dollar libel suit against a Florida newspaper and journalist John Sugg. Emerson’s complaint centers on allegations published by the newspaper that two Associated Press reporters said Emerson gave them a document on terrorism supposedly from FBI files but which actually was written by Emerson himself. The lawsuit also disputes allegations that Emerson gave false information to a Senate subcommittee during testimony in 1998.

Also in court is Adam J. Ciralski, a 21-year-old attorney who claims he lost a job with the CIA because it concluded that his own and his family’s close personal ties to Israel made him a security risk. One of the investigators allegedly said that Ciralski had “Israel written all over him.” In a letter to B’nai B’rith’s Anti-Defamation League, CIA Director George J. Tenet conceded that investigators had used “insensitive, unprofessional and highly inappropriate” language in Ciralski’s case, but made no offer to take him back. Tenet, readers may recall, was rumored to have told President Bill Clinton at Wye Plantation in October 1998 that if convicted spy for Israel Jonathan J. Pollard was released as part of a deal to get Israeli Prime Minister Binyamin Netanyahu to sign the Wye Agreement with the Palestinians, Tenet would resign.

Readers will also recall Ciralski’s lawyer, Neal M. Sher. He was the Justice Department’s former chief Nazi-hunter as director of the Office of Special Investigations before leaving to become executive director of the American Israel Public Affairs Committee, Israel’s principal Washington, DC lobby. Although now in private practice, he obviously is stuck in the same old rut. Meanwhile it seems that CIA spokesman Mark Mansfield would like to say more about Ciralski. “We would be happy to comment if Mr. Ciralski’s lawyer would provide a Privacy Act waiver on behalf of his client,” Mansfield said in September.

Speaking of telling all, we were impressed with the determination of Chairman Sonny Callahan (R-AL) of the House Foreign Operations subcommittee to reject President Clinton’s proposal to pay Israeli Prime Minister Ehud Barak $1.2 billion in advance for carrying out the territorial withdrawals promised by former Prime Minister Binyamin Netanyahu. In this he was backed up by Rep. David Obey (R-WI), as reported on p. 78 of this issue. Callahan lost, however, on his proposal to remove the provision whereby Israel gets all its foreign aid in the first month of the fiscal year, while other foreign aid recipients have to make do with quarterly installments. In the debate Callahan called the special concession to Israel, and a similar concession the administration vainly advocated for Egypt, “stupid foreign policy” which he attributed to the “Israel lobby.” Chairman C.W. Young (R-FL) of the Appropriations Committee picked up on the reference to the Israel lobby, saying that “the perception is growing as to who controls this Congress.”

That thought was also on the mind of Republican presidential candidate Pat Buchanan during a Sept. 12 interview on NBC’s “Meet the Press.” “The Israel lobby, or any other lobby, is not going to dominate foreign policy if Pat Buchanan becomes president of the United States,” he said. “Our policy in the Middle East should be based on American values and American interests.” You’ve got to like some of these Washington insiders and hope they won’t become inside outers for being honest.

Rep. Michael Forbes of New York, who was a critic of former House Speaker Newt Gingrich, a booster of Rep. BobLivingston (R-LA)who almost succeeded Gingrich, and then found himself an outsider again in the era of Dennis Hastert (R-OH), has become an ex-Republican. His political rebirth as a Democrat cost him most of his congressional staff but brings him closer to such predictable New York Democratic supporters of Israel as Representatives Eliot Engel, Jerrold Nadler and Gary Ackerman. Hardline Zionist Organization of America president Morton Klein, who, according to Forward newspaper’s Washington columnist Seth Gitell, “has worked closely with Mr. Forbes in the past,” told Gitell “at least half of the people we work with on issues of concern to Israel are Democrats. Mike Forbes becoming a Democrat does not change his views with regard to Israel.”

The Clinton administration has had no success in dissuading Pope John Paul II from visiting Iraq between Dec. 2 and 5, Chaldean Catholic patriarch Raphael Bidawid told the National Catholic Reporter. He said the pope has applied for United Nations approval to land in Baghdad and meet with Iraqi President Saddam Hussain and also to travel 220 miles south by helicopter to visit the site of Ur, the ancient city from which Abraham set out perhaps 3,500 years ago.

The Rev. David Yager, an Austin, Texas-based priest who represents the Vatican on a committee to improve relations with Israel, shocked an audience at a July 19 conference on anti-Semitism in Tel Aviv by blaming Israel’s anti-Catholic attitude for tensions between Jews and the Catholic church. Yager described persistent criticism by Jewish leaders of the World War II record of Pope Pius XII, whom the Vatican is preparing to nominate for sainthood, as a “blood libel.” Yager also charged that the commonly used Hebrew word for Jesus, Yeshu, is actually an acronym for “May his name and memory be erased.”

Eugene Fisher, director of ecumenical affairs for the U.S. National Conference of Bishops, told The Jewish Week of New York that Yager’s use of the term “blood libel” was “entirely inappropriate” but that it reflected a mounting concern in the Vatican about “groundless” Jewish attacks on Pius XII. Jewish Week interfaith affairs columnist Eric J Greenberg reported that “regarding Jesus’ name, Jewish researchers said that Yeshu is either the Hebrew corruption of the Greek version of ‘Joshua,’ perhaps Jesus’ birth name, or the shortened version of ‘Yeshua,’ which means savior.”

Maryland officials and Hispanic activists are seething over a series of legal maneuvers whereby the family of Samuel Sheinbein, now 19, has prevented his prosecution in the U.S. for the 1997 murder of Alfredo Tello Jr. only child of Central American immigrant mother Eliette Ramos of Silver Spring, a Maryland suburb of the U.S. national capital.Tello’s dismembered and partially burned body was found in an empty garage adjacent to the Sheinbein home in prosperous Montgomery County. American-born Sheinbein fled to Israel with the assistance of his Palestine-born father, patent attorney Sol Sheinbein, and a brother, and then claimed Israeli citizenship. After Israel refused to extradite its new citizen for trial in the U.S., Montgomery County state’s attorney Douglas Gansler, who is Jewish, thought he had an arrangement for Israeli authorities to try Sheinbein on first-degree murder charges in Israel, and bear all the expenses of bringing witnesses to testify.

Instead, Israeli authorities reached a plea-bargain agreement whereby Sheinbein is expected to plead guilty to first-degree murder in return for a 24-year prison sentence. Under Israeli law he will be eligible for weekend furloughs after just four years and for parole in 14 years. If he had been convicted on the same charge in Maryland, he might have faced a sentence of life in prison without parole.

Complained director Henry Quintero of the Latino Civil Rights Task Force of Maryland, “If it were one of my Anglo-Saxon friends who was murdered, more would have been done.” Montgomery County Latino activist Grace Rivera disagreed, saying “I don’t think it has anything to do with race. It has to do with justice.”

Tello family spokesman Brian Jordan blamed what he called a “miscarriage of justice” on “Israel’s misuse of a law passed in 1948 when the Jewish state was formed… The original intent of the law was to protect those fleeing persecution, not prosecution. He blamed U.S. officials for not applying enough pressure on Israel for Sheinbein’s extradition, saying “the guilt is shared by both nations.”

President Elizabeth Feria of Hispanics United for Montgomery agreed. She told the local Bethesda Gazette, “The U.S. could have done more. I think if it was a Latin American country they would have turned him over right away.”

In an editorial entitled “Getting Away With Murder,” the Gazette criticized a statement by Israeli Attorney General Elyakim Rubinstein that Israel’s action “is more than reasonable [because] this is not Maryland.”

“That is exactly the point, Mr. Rubenstein,” responded the Gazette. “It is not Maryland. Israel had no business getting involved in the case. The crime took place in Maryland. The victim and the accused lived in Maryland. The trial should have taken place in Maryland…Instead Sheinbein will do a few years of relatively easy time in a relatively easy prison, and walk out a free man at 33. Tello, on the other hand, will be dead for a long time.”

Meanwhile state’s attorney Gansler, who had called the plea bargain “an insult to justice,” had new reasons to complain. Contrary to the agreement with Israel, Israel has not yet paid his and other Maryland officials’ travel bills to and from Israel. And, to thwart Gansler’s plans to arrest him for helping his son flee the U.S., father Sol Sheinbein has moved to Israel, where he, too, presumably will be sheltered from extradition to the U.S.

Summarizing the case, the Bethesda Gazette concluded its editorial with a rhetorical question: “Why did Samuel and Sol Sheinbein think they could get away with it? Because they have.”