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Jewish World: Tribal Tribulations
Elliott Gotkine Lima
High-profile Peruvian Jews are caught up in a slew of high-profile corruption cases. And that�s not even including the rumors about the Jewish wife of the president.
A man's house may be his castle, but for Alex Wolfenson, his home�s been his prison for the past five months. As jails go, it�s not so bad. From his third-floor apartment in the posh Lima suburb of San Isidro, he has an exquisite view of the golf course that dominates the area. Inside, he�s surrounded by expensive-looking paintings and the other trappings that come from running a newspaper empire. "I know it�s worse being in San Jorge [a Lima prison]," he says, "but at least there I�d have more company."
Alex Wolfenson and his older brother, Mois�s, are under house arrest, charged with stealing state money, and facing up to eight years in prison. They are not the only members of Peru�s small, yet powerful, Jewish colonia (community) of some 3,000 who have been accused of being involved in the web of corruption weaved by ex-president Alberto Fujimori and his right-hand man Vladimiro Montesinos, who is now himself imprisoned, awaiting trial on some 100 charges, ranging from bribery to human rights abuses.
Former TV station owners Samuel and Mendel Winter are in prison awaiting trial, and Efrain Goldenberg, Peru�s ex-finance minister, is accused of various crimes, including mismanagement of some $140 million in state funds, particularly relating to the then-government�s spending on election ads. He fled to the United States when the scandal began to unfold and remains there to this day.
Of course, in a country where almost every day brings a new scandal to light, Jews aren�t involved in all of them. Unless you count the president�s Jewish wife, Eliane Karp, no Jews were involved in President Alejandro Toledo�s paternity battle over the 14-year-old girl he now admits to fathering with another woman; nor, for example, were any involved in the party thrown by a government agency charged with feeding the poor. It blew thousands of dollars on wine, local delicacies and scantily clad dancing girls for a Father�s Day bash.
If the Wolfenson, Winter and Goldenberg cases weren�t bad enough, further epic scandals have pushed what would ordinarily be communal matters into the national spotlight. The first involves the loss of some $50 million by Jewish individuals and communal organizations who had invested in the holding company of Banco Nuevo Mundo (BNM), a Jewish-run bank that the Peruvian government is trying to liquidate.
"They have betrayed the trust that members of the community had put in them, ignoring the concept that a Jew should protect his brothers and not do them harm." Thus the psak din, or decree, issued on June 10, 2001 by three rabbis, effectively excommunicating the Jewish directors of BNM for failing to accept responsibility and return the money. This means they can�t be called up to the Torah in synagogue, be counted in a minyan or participate in parental activities at the Jewish school. One director, Herbert Herschkowicz, recalls attending a Jewish funeral at which the grave digger was chided for allowing him to throw earth on the coffin.
Sitting in a suite at his five-star hotel, Los Delfines, Jacques Levy, the 48-year-old former head of BNM, says his problems began when government institutions started to withdraw their deposits, draining BNM�s financial reserves. "It was financial terrorism," says Levy, although no one seems prepared to suggest what the government�s motive might have been. When, in December, 2000, the Peruvian banking authority intervened, BNM had a loan portfolio of $495 million and deposits of just $47 million.
The directors contend that almost all the depositors in BNM have been given their money back. The problems, particularly with the Jewish community, arise from a Panama-based holding company whose main investment was BNM. The directors of BNM sold millions of dollars of promissory notes to Jews and Jewish groups in the holding company. When the superintendency closed the bank, the notes became worthless, turning millionaires into paupers overnight. Even a Jewish retirement home lost money.
The charges leveled at Levy and his fellow directors by Peru�s Jewish community are: They duped investors to buy into the holding company, when they thought they were buying BNM; they invested the holding company�s money in businesses in which the directors had a beneficial interest; they continued to solicit deposits right up to the day before they knew the superintendency was going to intervene; they refused to repay the money they lost; and they brought shame upon the community in the eyes of non-Jewish Peruvians when the scandal hit the national press.
Levy and the other directors deny all the charges. They maintain investors knew where their cash was going and that money, and the pressure brought to bear on the Peruvian rabbinate by those left out of pocket, were the only motivation for the religious decree. Part of their defense is that a video recorded in Vladimiro Montesinos�s office has army generals and fellow congregant Mendel Winter talking about putting Peru�s smaller banks out of business. BNM�s accusers suggest fingering Montesinos for the attack on their bank is the perfect excuse -- after all, he�s accused of so many other things, who�s to say he wouldn�t launch an unprovoked attack on Peru�s smaller banks?
BNM�s directors had a victory of sorts at the end of October, when their attempt to block the bank�s liquidation was successful. Now they plan to sue PriceWaterhouseCoopers, the firm that audited BNM for the superintendency. One director says he is so embittered that he�s delighted his son is going out with a non-Jewish girl. Another says he was offered a way out of the psak din, so long as he distanced himself from his fellow directors and handed over the money he was said to owe. "But why would I do that?" he asks rhetorically. "So I could be counted in a minyan in jail?"
The BNM case continues to bubble, but it�s been pushed to the sidelines by other scandals. The most recent involved a secretly taped conversation between Mois�s Wolfenson and Salom�n Lerner, former president of Peru�s sprawling development agency, Cofide, coordinator of the Peruvian branch of the Jewish Human Rights Association and close friend of President Toledo.
According to Peru�s Conservative Rabbi Guillermo Bronstein, the tape has "reopened old wounds." Lerner is allegedly heard telling the Wolfensons to change the editorial line of their tabloid newspapers to being pro-Toledo or they�d find themselves in the same position as the imprisoned Winters. (Samuel Winter is Mois�s�s father-in-law.) "You can�t fight power," Lerner is allegedly heard saying. Two versions exist as to why the meeting took place. The first has it that Isaac Galsky, Alex Wolfenson�s father-in-law and Peru�s richest Jew (estimated to be worth $200 million), had asked his business partner, Lerner, to arrange the meeting because he didn�t want to see his extended family in trouble.
The other allegation is that Toledo asked his friend Lerner to put pressure on the Wolfensons, who had supported Fujimori since 1995. The Wolfensons accuse Lerner of trying to blackmail them. Lerner denies the charges, but has had to resign as president of Cofide, because of the scandal.
As for the tape itself, "I didn�t record it," says Alex Wolfenson, "much less bring it to light. My brother says he didn�t either and I believe him, because he�s my brother." Moises, who is also a former congressman, has been reported as saying: "It would seem almost impossible to record a totally private conversation."
The other epic scandal which has brought the Jewish community into the limelight involves Montesinos, former president Fujimori�s spy chief and right-hand man from 1990 to 2000. At the beginning of his third term, the increasingly autocratic Fujimori was suspected of buying off opposition politicians and media. But there was no proof. Until on September 14, 2000, a video was broadcast on a Lima cable news station showing Montesinos handing over $15,000 in cash to an opposition congressman. This first "vladivideo" was political dynamite. And by the time the dust settled, Fujimori�s government had fallen; the ex-president had fled to Japan; Montesinos had been extradited back to Peru from Venezuela; and people close to Fujimori and Montesinos -- including the Jewish ones -- were in trouble.
One of these was Israeli arms dealer Zvi Sudit who, through his company Hightech Technology, has reportedly admitted paying millions of dollars in illicit commissions to Augustin Mantilla, a former interior minister. Sudit has been supplying arms to Peru since 1980. He was also close to Montesinos; according to one report, Montesinos entrusted Sudit with the $15 million payoff the spy chief received from Fujimori, before fleeing to Panama and on to Venezuela. Sudit, along with his Jewish partners, Israeli Ilan Weil, Peruvian Rony Lerner (no relation to Salomon) and Canadian/Peruvian James Stone (also a close friend of Montesinos), are helping prosecutors with their investigations. The star witness in the Montesinos case is Matilde Pinchi Pinchi, the former spy chief�s personal aide who is cooperating with the investigation in exchange for immunity. Among the many unfortunates she fingered are the Wolfensons who, she says, received $14,000 a week for over a year from the former spymaster in exchange for supporting Fujimori in their newspapers. "We�d supported Fujimori since 1995," counters Alex, "so why offer us money if we already supported him?"
The allegation leveled at Samuel and Mendel Winter created even more of a storm, not only because they are in prison awaiting trial for stealing state funds, via the bribes they allegedly received, but because it involved a very public spat between them and Israeli-born media tycoon Baruch Ivcher. The Winters were arrested in February last year, just days after their mother died. They were accused of accepting $5 million from Montesinos to help them buy a majority stake in Frecuencia Latina, the TV channel owned by Ivcher. The Winters already owned 46 percent of the station and were, at one time, friends of Ivcher�s. In exchange, the Winters -- who are said to have visited Montesinos almost daily in the run-up to the 2000 elections -- allegedly signed a contract agreeing to run only Fujimori ads during the campaign.
Sitting in his cavernous office at his TV station, Ivcher clearly remains angry with his former business partners. Ivcher, who admits to having met Montesinos on several occasions, had irked the authorities by refusing to drop certain reports, among them one on cocaine being found in the president�s jet, and another in which El Vaticano, Peru�s most notorious drug trafficker, claimed he paid Montesinos $150,000 a month. The government went on to accuse Ivcher of selling arms to Ecuador during Peru�s war with its northern neighbor. (He says there were plans to torture him and get him to admit his treason on camera.) He fled, knowing that if found guilty, he would have faced death by firing squad. Ivcher was stripped of his citizenship -- with the collusion of the Winters, who had hoped to gain control of the station.
Only on December 4, 2000, a few days after Fujimori�s abrupt departure, did Ivcher return, having regained his citizenship and control of his TV station. As for the local Jewish community, its support, he says, amounted to "deafening silence."
In a country where the trial of Montesinos -- now Peru�s public enemy number one -- can be postponed just two days before it was due to start last month, predicting what will happen next to this cast of characters is a risky business. Peru has already updated its internment laws to keep the Winters in prison for up to three years without trial. And there�s always the possibility further charges could be leveled against them, sending them back to jail when they�re released. Alex Wolfenson, at home in San Isidro, says the maximum he can be kept under house arrest is six to eight months, so unless he and his brother are tried in that time, they should (in theory) be freed within the next four months.
If found guilty of charges including embezzlement, illegally obtaining funds and resisting authority, the BNM directors face up to six years in prison. While no trial date has been set, the rabbinical decree stands. Sudit continues to cooperate with prosecutors and remains free.
Inevitably, much of the Peruvian press has had a field day with these scandals, referring to "the Jewish bank," "Jewish arms dealers." Even Adam Pollack, "First Friend" of the president, is identified as "Jewish-born."At least according to one report, he can�t return to Israel, where he lived for 27 years, because he faces embezzlement charges.
On the other hand, now that he�s the country�s second vice president, the incorruptible David Waisman�s Jewishness is rarely mentioned. Nor that of Daniel Schydlowsky, current president of Cofide and widely touted as the next economy minister.
Still, there�s always the first lady. Unproven allegation of financial impropriety have been leveled at Elaine Karp, who, despite all her work with Peru�s indigenous and poor, has an even lower approval rating than her husband. "She�s made so many enemies," says Rabbi Bronstein, "that whatever government gets in next will probably investigate her."
But at least by then, Peru�s other accused Jews will either be free, or quietly serving time.
December 2, 2002
Jewish World
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