Beware of Car Warranty Scam

Late last week, I've received two rather official looking notices. Notice #1 mailed from St. Louis, MO from "Vehicle Protection of America Automobile Coverage Headquarters". The company knew year, make, and model of our vehicle and had a lot of official looking prints. It mentioned that our "factory warranty is expiring or has expired, based on year and mileage" and offered to extend coverage. At the bottom of the notice there was an official looking seal from American Consumer Council saying Consumer Aware Winner 2011-2012.

Given that we never had a factory warranty (we bought a used vehicle and purchase a warranty that has not expired), I thought the notice strange, but possibly mistaken. I put it in a pile of things I need to follow up on. I figured that I would call the company that provides our car warranty to see what was happening.

I had not yet figured out I was looking at a scam, and I'm fairly good at sniffing out a scam. One thing I always, always recommend when you receive a notice, either via snail mail or email: do not respond directly to the notice (and never though an email link), but call the company that you deal with directly. In this case, I would pull my warranty and call the company with my name and account number, not respond to the notice.

Today, another notice marked "2nd Attempt came", only days apart. This one from a company "CarSafe", also bulk mailed from St. Louis, MO. This notice was a bit different. It also looked official. The format was nearly undistiguishable. The codes, however, had different names and numbers. The "Urgent and Time Sensitive" "2nd Attempt" notice from CarSafe, the second company, offered a Platinum plan. Vehicle Protection of America offered a Gold Coverage Offer.

Each notice had a second phone number. The CarSafe notice I quickly flagged as a scam as it requested "Please have your mileage and VIN # ready so we may better assist you."

A search of Vehicle Protection of America" and "scam" didn't turn up anything useful. A search of "CarSafe" and "scam" turned up results. As per this Washington Post column, St. Louis is home to car warranty scams and 10 companies are being sued by the state AG.

Be warned and for those who have family and neighbors, particularly elderly family and friends, make sure they are forewarned. I have a good eye for scams and this one has a nice costume.

One last clue that something is terribly wrong: My name was misspelled and I am not the primary name on our auto, my husband is. If they were working with the manufacturer or our warranty company, they wouldn't be sending me mail.

A Must Share from Mishlei

I ran across what follows in Mishlei a while back and it hit me like a ton of bricks because it described people that I've interacted with over time that lacked integrity, even though they talked a good talk.

In light of the my recent postings, I thought it was worth posting and always relevant. Translation is from Feldheim's Malbim on Mishley. Commentary is from Rabbi Meir Leibush Malbim. Note that this selections comes from the perek which begins with the case of a man becoming a surety for his neighbor, yet giving a handshake to the stranger. The man has promised the same thing to two people and has to save himself. He is instructed those who promise what they don't have not to sleep. He must shed his external trapping to save his integrity and the fight is an uphill battle. He is then instructed to regard the way of the ant, the ant who works with great independence and diligence as he stores for the winter.

Mishlei captures the human condition and the words are just as powerful today as any. The picture Shlomo HaMelech paints is so very vivid.

Perek Vav (12-14)

"An irreligious person, a man of iniquity, walks with a perverse mouth; winking with his eyes, scraping with his feet, pointing with his fingers. Treacherous fickleness in his heart, he devises evil continually; he sows discord. Therefore his calamity shall come suddenly; all at once he will be broken, and without remedy."

Commentary:

An irreligious man who flaunts the commandments between man and his maker and is evil toward his fellowman can be recognized by seven characteristics, listed here:

1. His speech: he attacks wisdom, the principles of the moral law;

2. His actions: "Winking with his eyes" denotes that he disregards the command "you shall not turn astray after your eyes"

d. His movements: "Scraping with his feet" implies that he rushes to do evil;

4. His hands: "he points with his fingers"

5. His thoughts: "treacherous fickleness is in his heart" -- in matters of faith he is heretical

6. "He devises evil" in his relations with others.

7. "He sows discord" among others, acting as a source of social tension.

Have You No Shame?: Frum Peddler of MHA Writes and Writes

For (Orthonomic) background on MHA scam, see Lakewood Local.

This letter to The Lakewood Scoop regarding MHA is written by a loud and proud person who claims to be the first to introduce the program to the frum community. Wow! I'm blown away. Brazen is the only word I can think to describe this drivel.

This post is a continuation of a discussion of Get Rich Quick Schemes: see the previous post and a post from 2008. Add to this discussion of putting the cart before the horse. Also add to this discussion the many posts on Areivim "life insurance" because it all fits together in a larger discussion.

Here is a man that claims he brought big money into the frum community when he introduced and pedaled a product in the frum community, a "product" that wasn't actually a product after the grocery business was dropped and one that will reveal, with a simple Google Search, that there were quite a few questions on the business model, or lack thereof.

He is the tzadik and you just aren't hearing him out. Yep, I've dealt with those who lack integrity and I have a profile in my mind of how some people talk and walk. This might just be a letter, but the swagger and attitude is ever present. I can hear the letter and it is like deja vu. I can physically feel the letter in my bones.

Because the topics of yashrut and integrity are part and parcel of our being, and because I've been asked in the past about how to spot those who you don't want to do business with, I'm going to take the liberty to reprint parts of the letter for those who simply have yet to deal with someone like this because there is an educational purpose, even if this particular writer is sensational to the max. The emotions, the accusations, the self-promotion, the attitude. It is all there and it is sociopathic. (Note to self: pull a relevant find from Mishlei for the blog).

I have no idea if I have any readers are ones left holding the bag from MHA, but if you are, before you take the advise of this businessman purporting to be doing nothing but chessed, do yourself a favor and get legal advice before disputing charges on your credit card, i.e. taking his advice. The man cannot see straight.

It is so sad to see the comments coming in on this letters, comments such as:

"I think the Salesman was not intending to scam anyone..since the program was for 230 to get a 300 dollar card..if it lasted 5 months you are already ahead. I don’t think anyone truly thought this thing will last forever. Even now one can buy giftcards at 10-15% below face value..(big companies like Staples and Target sell them to get cash in bulk)." [My note: Put your gemorrah kop on. You simply can't compare big box stores selling prepaid gift cards for a discount to a company selling cash for cash. Staples and Target sell a product, not cash. It is to their benefit to gain your loyalty, peek your interest, and get you into their store to buy product.]

The question is to invest in a “window of opportunity” investment..where it makes sense until it doesn’t..if that is considered a scam. [My note: do you hear yourself?]

And this: "I dont know why so many people are beating up on you. I know you and you helped us out in a way that you thought we could all gain. And you helped us when it went down.

Fortunately there are just as many posters who do get it.

The letter:

. . . . . It’s amazing how so many people are mamesh mikayem naaseh vinishma when they blog. Why don’t you first find out the facts?

I was the first one to bring this to the frum world and I am happy I did. Since I did not listen to all the “its a scam” people, I got thousands of dollars into yiddishe hands. People who are have ordered their secure sleeves and expected to get a gift check (not CARD) can get back their money by disputing it with thier credit card. [deleted]

MHA was not a scam. No one got scammed. The ones who can not dispute, are those who made the purchase with a gift card. They will have to wait for the court to first collect all the assets of MHA and only then send in your claim. You will get a portion of the pie. (Not worth your time)

The “if its too good to be true, then it’s not true” people, could have been 5 – 10 thousand dollars richer by now. But alas “its too good to be true” so while you are wise and not naive, you remained wise and not naive but all the rest of us got money.

The “someone on the bottom will be left holding the bag” group of people, never took the time to understand that with this program you make money even if you don’t sign anyone up. They WILL be holding the bag, IF they don’t dispute it.

[. . . . . ]but I think it’s different when there is a credit card involved, because THEY are the ones who protect you.

“But lemaaseh Some people DID lose out, like the people who purchased with a gift card”. Good point, so let me ask you should have we decided not to pump in $150,000 into Yiddishe hands because someone might buy it the wrong way? Lets see what the coffee room says.

And for Mr. K who threatened to report me to the FBI and who threatened to publicize all my emails (in which I help everyone to make sure they dispute the charges properly). You’re mamesh a tzadik.

Finally I’ll say this. Besides for Mr. K (who was not even in MHA) I did not get even one accusing phone call. Every single person was so nice. Every one told me we know it’s not your fault and thank you for helping us with the information we need to retrieve our money.

I’m sure everyone who wrote things that are not so nice only did so because they were upset FOR those who may have lost money.

At the end of the day we still have each other and we each care for each other and this is what HKBH wants. Even my friend, Mr K. also meant well.

Wishing all my fellow brothers bracha vehatzlacha uparnassa b’revach.

And finally, I have a new thing which you could make thousands a month. It’ll cost you only $5. Pay ONCE. That’s it. Be careful, you might be “holding the bag”. Im serious.

[In comments further down in the thread the letter writer continues dig a hole, one that is really ugly. Might not be long until the pidyon campaign at this rate. See the lengthy comment #36 where he "lays it all out on the table" about how he didn't understand the business model but the men in charge have so much experience, how the business was ruined by consumers who called Walmart and later Wells Fargo souring the relationships, how consumers with funny names ruined a good thing, and on and on. Oy, a true believer who outlines a ponzi scheme, but has no integrity or clarity. And now he has another $5 opportunity for you to "invest" in if you are matzliach. . . an (illegal) chain letter with an attached product to kasher it].

And here is another jem from Mr. Parnassa:

I dont own the $5 business company. Ill send the link to those who are interested. And btw no one I know is out thousands. I just cant believe how people can talk without getting any facts. There is not one person i know who is out (so much) money.

We should all be tearing kriah. As reader JoelC says, "The comments on the Lakewood Scoop on this are heartbreaking. The mixture of naivete and brazenness make me lose hope for our brethren."

Time to promote the Tortoise over the Hare. Slow and steady is the way to "get rich."

A is for Aiding, Abetting, and Accountability

This week of Jewish News features two events which I believe feature an underlying factor: lack of accountability, . The first event was an emergency campaign to raise $50,000 for the boys in Japan. The second was the sentencing of W. Runge.

In the latter case, the defendant was accused of deceiving the state in procuring tax credits for film, pleaded guilty, and then proceeded to set up a now defunct blog slandering the judge and prosecution, accusing them of impropriety, political conspiracy, and anti-semitism. Her story and words were featured on the Chazak Hotline and in Jewish publications, including the Jewish Star (see Shining a Light on Iowa for some rather grotesque charges again "Iowa"). While her story and accusations certainly didn't receive the press of other ongoing stories, the underlying themes were the same.

The judge handed her a doozy of a sentence, although she appeared contrite in court, based on her public statements from the time she plead guilty onwards. Here are his words, which were delivered hesitantly and with some pain.

This is a very difficult case for the court. Here is a defendant who has no prior criminal history, who has a family, and who isn't normally a candidate the court would consider as a candidate for incarceration. However, this defendant not just before her plea of guilty, but even after her plea of guilty, has not taken responsibility for her behavior. There is nothing muddying the waters about that. And your statement here today is not genuine and not sincere. What is sincere is the things you said out of the courtroom, out of your probable perception that it would make its way to the courtroom, because there is no reason not to be truthful there in that setting. And it that setting, you have attacked the judges who have presided in your case, you've attacked the prosecutors, you've blamed this on anti-semitism, you have blamed this on some sort of political conspiracy, and you have not taken responsibility for what you did.

And what you did was a felony. It was a criminal class C felony. It is considered a very serious crime by the Iowa Legislature. It was an attempt to defraud the people of the state of Iowa. And one of the most important considerations for the court in determining an appropriate sentence is to. . . it's not one of. . . it's the guiding principals for the court to choose a sentence that will both provide a maximum opportunity for your rehabilitation and also deter the commission of this offense by others. This cannot happen by placing someone on probation who does not accept responsibility for what she did, who publicly proclaimed that what she did was not wrong, and it certainly will not deter others from doing that.

This is a case, that in my judgement, calls out for the court to send a message to you and a message to others who would engage in this kind of behavior that it is not accepted, that it is criminal, and it won't be tolerated.

Whether at some point in time I might be willing to reconsider my judgement in this case is open to question. But for right now, at this moment in time, based on what you did and, again, your complete, what I would call arrogant, defiant, disclaiming responsibility, this in my judgement is an appropriate sentence. For the reasons that I just said, you are sentenced to an indeterminate term of incarceration not to exceed 10 years, you are accessed fine, the mandatory minimum fine of $1000 along with the applicable surcharge. I'm going to suspend your sentence because of your incarceration. . . etc.

In the case of the boys in Japan, the emergency campaign sought to raise $50,000 this week in order to pay a fine for Yaakov Yosef in order that he Japanese authorities consider transferring him to Israel. While other Jewish publications had previously published other accounts of the boys' story, the current account reads as such:

Japan. A strange and foreign land, geographically and ideologically. A country whose crime rate is exceptionally low due to its merciless treatment of criminals and even suspected criminals, whose penal system includes harsh labor camps and prisons. A place where two of Acheinu Bnei Yisroel are incarcerated for over two and half years through no fault of their own.

"Through no fault of their own." In each and every case I've highlighted in the past few years, the underlying theme of Jewish media is "though not fault of his/her/their own. It is a witch hunt, the product of anti-semitism, the result of a cruel penal system (never mind that Hashem commands societies to establish courts of law and seek justice).

I don't any particular issue with a kehilla stepping forward to help accused and/or convicted Jewish criminals, although these "pidyon shevuyim" causes are not my tzedakah of choice as I don't believe any of the cases presented obligate that I divert money from the little real tzedakah we are able to give after bills, tuition, and shul dues for pidyon shevuyin.

What I do have an issue with is lack of accountability and lack of introspection brought on by a Jewish media circus. In an attempt to create stories of inspiration and chizuk or in an attempt to promote being dan l'chaf zechut, lines of battles are being drawn in the sand between "them" and "us", and lost amongst the furvor are any opportunities for introspection and accountability. And in the case of Ms. Runge, giving her a platform to attack the prosecution and judges (an example here at Matzav), media--her own and Jewish media--has essentially aided and abetted in her sentencing, a sentencing that no doubt would have been much softer had she expressed only contrition and throwing herself at the mercy of the judge.

If the boys in Japan (ages 17, 19, and 22) were not at fault for accepting $1,000 each for agreeing to transport antiques in closed false bottom suitcases at the sum of $1,000 each (a sum that is being called "small" but for which is takes much effort and education for many a working person to net), then who is is at fault?

The Jewish media is busy talking about the lack of rachmanut present in the Japanese justice system and criticizing it full force (see Gil Student's article from 2009). While there are tehillim gatherings, speeches in shul, and emails being sent around listserves, I've yet to see someone in a position of "authority" talking about parenting, vocations, employment, poverty, or life outside of yeshiva.

The Japan case isn't the first case where frum boys acted as drug mules, nor will it be the last in there is no accountability. I can think of at least two other past cases, and in one the (non-frum) judge gave the parents of some 17 year old boys quite the mussar schmooze on parenting. If the boys share no fault, than certainly the parents and those who act in loco parentis share some responsibility? How do young, unmarried men (from impoverished families) make it out of Yeshiva without eyebrows raised, much less out of the country? I can barely make it out my front door without inquiries from the in-laws! When I was a teen, I could barely make it down the block unnoticed. I specifically remember one time where my *father* interrogated me about a T-Shirt I was wearing that he did not recognize.

Long overdue is some real accountability. [Cynicism warning: but all there seems to be are messages about tzniut].

Stop the Circus: Why do you make yourselves conspicuous?

And Yaakov said to his sons: “Why do you make yourselves conspicuous?” (Parshat Miketz)

A few readers/posters alerted me to a People's Court story that had taken on a life of its own. There is a saying, seeing is worse than hearing. And, I can't think of anything more true at this point.

I really don't have much to say except how timely the episode aired, during Chanukah, promptly after the reading of Parshat Miketz. In this parsha, Yaakov says to his sons, "Why do you make yourselves conspicuous?" (Lama Titra-u?) Why do you display yourselves? Why do you invite (negative) attention (from Bnei Yishmael and Bnei Esav)? Why do you incite jealousy and ill feelings though shows of "wealth"? Where is your common sense as you gallivant (my best word for what the Sforno describes) about displaying your situation for what it isn't?

I can think of no worse place to make a spectacle of oneself (and one's people by extension) than on ***day time*** television*, during what is being called the Greatest Recession since the Great Depression over a "mid-range" $3000 hairpiece! In the words of Rabbi Eli Mansour, "Yaakob understood what far too few people today understand – that showing off material success, especially in periods of financial instability, invites hostility, not admiration. When a person flaunts his wealth, people around him become resentful – not his adoring admirers."

I don't believe that the public defense of the couple by Rabbi Yair Hoffman is at all helpful to the situation. Such only ensures the circus parade marches on, adding more speculation to the train wreck in process. I am very sorry, but neither he, nor I (. . . and I've actually been trained in conducting audits, gathering documentation, and 3rd party verification) have the capability of performing a proper investigation of the matter. Amateur investigations are not only ill advised, but sure to raise further questions and solidify the spectacle. JUST LET IT DIE and let's roll with the mussar of our Avot and of Chazal to always be beyond reproach and keep a low profile.

(And while I respect the actual mussar of the other Rabbi who commented on the People's Court Wigging Out Story, I think he went way overboard accusing the couple of intentionally going out to rob from the poor, i.e. the laundry mat owners. Jumping to conclusions in either scenario is unprofessional and inappropriate).
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*I don't recommend watching daytime television, nor do I watch daytime television. But, as a note of interest tv ads during daytime television generally fall into three categories: 1) ads for job training aimed at the unemployed/underemployed, 2) ads for ambulance chasing lawyers, and 3) ads for medication.

Be Proactive, Not Reactive

Rosie has been pointing me to some interesting excerpts and stories in the Hamodia (thank you for being my eyes and ears). I was able to take a peek at one story she pointed me too. In the magazine, there is an article by Rebbitzen Tzipporah Heller and in the last paragraph she pleads with wives to stop their husbands from committing fraud (she notes that not such a small number of frum men are behind bars) by being alert to spending that doesn't add up and, where suspicious, confronting the husband and putting a stop to it.

The story that preceded this warning, was unfortunately rather convoluted. Although I certainly was pleased to see that at least one magazine is broaching the subject of fraud, I prefer a more direct approach and this wasn't it! The story, as laid out by the Rebbitzen, featured a couple that started off life with the struggles of a kollel family. The husband later entered the insurance business and yet as the tuition bills grew, the struggles never really let up. Yet, each big-0 birthday featured a rather large gift and the wife starts to think perhaps she should ask questions, but doesn't. (Hope I got that right).

At least on my end, the every-10-year-large-gifts really didn't raise my suspicion that there was something fishy going on (e.g. at 40 they took a trip to Israel and at 50 he bought his wife a large candelabra--as I recall). Sure, the numbers might not add up, but 1. a large ever 10 year gift is not particularly out of reach and 2. there was no other indication of regular expenses that should serve as warning signs (large mortgage, luxury cars, bling). The only real large and unaffordable expense that the story touched on is completely ordinary in our own society that it fails to raise a red flag, even if it should. (That expense: TUITION).

The article made me think just how unqualified your average woman is to detect her husband's fraud, especially where it is more subtle, and how needed advice and approaches must be much more concrete. Additionally, I don't care at all for the idea of getting suspicious and then confronting one's spouse. Why not suggest a more healthy, normal approach to *family* finance and be involved as a matter of course, not a matter of suspicion?

What I see as the real issue is that too many women simply aren't involved in their own financial lives and are at risk to be blindsided (and not just with something unusual like having the authorities show up one morning at your door to arrest your husband, but with something more usual like hitting the point of insolvency because of mounting debt). Some women don't want to worry their heads about such financial matters and prefer ignorance. Some women like to excuse their lack of involvement with some sort of "religious" excuse. Some husbands feel more manly when they deal with the money. . . . even when the wife is the primary income earner. Whatever the reason for non-involvement, if things go wrong the battle will have to be waged on a steep uphill grade.

The bottom line in my book is that if both spouses are not involved with the budget, that the family is not just susceptible to getting caught on criminal charges, but running their financial lives into the ground. I would say this is even moreso when one party's relationship to money comes from looking at what "everyone" else is doing, rather that taking a look at the only thing that really matters: the black and red budget!

So here is my advice: don't be on the lookout for fraud and in the position where you have to "confront" your husband (spouse), get involved in your own finances:

*take an active role in your financial life from day one. If you haven't taken a role up to this point, make it your duty to start being a part of this area of your life. Division of duty can still fall to whoever is best suited for the job, but neither spouse should be in the dark.

*always spend within your means and make guidelines for savings and debt. I don't believe every 10 year gifts are the trigger for fraud. My professional background and experience tell me that it is the regular expenses. So, make it a priority to not yourself on a path of monthly struggle.

*maintain balance sheets of assets and debts. Gifts can be a surprise, but there should be no mystery as to where the money to buy such a gift materialized from.

*learn about the industry that your spouse is engaged, what can be expected income in terms of income as well as other relevant information about the business. It is fairly standard practice for wives/spouses to be involved in the finances of a family owned business or even partnership.

*make integrity and honestly a focus of your marriage.

*don't pressure a spouse to provide what is not reasonable (see above regarding knowing what is reasonable).

Readers, add your comments

Here's the Problem: We Aren't Stupid

There is a post up on BeyondBT by a Rabbi who recounts his remarks at a forum on the question: "What happens when there is a scandal by a rabbinical figure in our community? How should we react?. . . "

The response was one I'm sure that most of us in the frum community have heard over and over and over again:
1. Don't Believe It: "Just because we see something written in the newspapers or over the internet, doesn’t mean I have to believe it is true! Just the opposite! We should always look at the individual as innocent until proven guilty, right?"
2. Dan L'Chaf Zechut: "There is a mitzvah to judge someone favorably even if the circumstances may appear to be incredibly incriminating."
3. Humans Make Mistakes: "We have to remember that even Rabbis are human and can make mistakes. It is very important that we judge the action and not the person. As we know, we cannot judge someone unless we have been in their exact situation."
4. Don't confuse Jews with Judaism: "If some of our own leaders are caught doing something against the law, what does it say about the community? Nothing!" and "Just because one can walk the walk and talk and the talk in frumkeit, doesn’t mean that the person is necessarily frum. It just means that they know the lingo. We have to be careful not to mix-up Jews and Judaism. "

The Rabbi then precedes to make a reference the not too far distant Spinka Case (here and here) and the Legal Symposium that followed (here and here):
"Unfortunately, the Orthodox world has not been exempt from scandals and recently there was a great rabbi who came out and spoke at length at the great tragedy that occurred with his institution. He never said it was an oversight or tried to brush it under the carpet but admitted that it was a imistake and warned people that they themselves shouldn’t make the same one!
This was true gadlus! This great sage admitted to the masses that there was a mistake made and a price to pay."

As I wrote on BeyondBT (slightly edited), here is the problem with this response in a nutshell:

we, the Orthodox public, aren’t stupid. Many of us are professionals who work day in and day out with issues of compliance. Some of us know what types of hard evidence it takes to even bring a case to trial, much more so to secure a conviction.

We know the difference between a “mistake” and a CRIME, especially organized crime which takes tremendous EFFORT and DELIBERATION to perpetrate (the case you refer to wasn’t simply a matter of forgetting to dot i’s and cross t’s, it was a fascinating case of affinity fraud/affinity crimes, worthy of a case study in Continuing Education courses).

Furthermore, when these cases continue to come to light over and over again it most certainly does say something about the community! Sadly, there are some people among us who have simply lost their moral compass, probably in part because “whitewashing” acts is all too reflexive a reaction.

The first rule of public speaking is "know your audience." I don’t know the audience that was addressed. Perhaps the answers were satisfactory for them. But, this answer which we have all heard repeatedly is hardly satisfactory. I think we are far better off saying that something is amiss in frumkeit today and that it is time to place issues of yashrut right up there with issues of kashrut.

Another rule of speaking: "sometimes less is more." In response to another case that hit the newspaper and TV headlines, the Rabbi of the community I lived in at the time said: "Despicable." Despicable works for me and I imagine it would work a lot better for the audience asking such questions.

Wasn't Even Going to Comment, but this makes for an interesting break

I wasn't even going to bother with the newest fraud case, this time brought to us by a crime ring in Israel that has been producing false ID cards and records for non-existent students to increase funding for certain yeshivot/kollelim by submitting false reports to the Education . Reports are stating that there are three non-profits involved and another 40 other co-conspirator establishments. Fraud has ceased to surprise me, and I didn't even bat an eye when scrolling through the frum news, until the latest installment of this newest case.

Given my professional and educational background, one thing I've learned along the way is the fraud isn't something that easily surfaces. Breaking a fraud case must often be accompanied by a great tip, hence vehicles such as anonymous fraud tip hotlines. And, here, the tip won't disappoint.

The "moser" that tipped off Israeli authorities is none other than our favorite friend, the Neturei Karta. As per reports, when members of this sect discovered their names were being used to illegally receive stipends from the Israeli government, they tipped off law enforcement and law enforcement began to monitor the illegal activity resulting in a raid and arrests.

I know I should only feel shame when yet another fraud scheme involving "observant" Jews who stand for "Torah" comes to light, but it is hard for me not to at least a slight bit, uh, excited about the tip that has brought yet another crime ring to face the music. Hashem certainly has a sense of humor.

How to Stop the Cat and Mouse Game

Hat Tips: Google Alerts

Over at Dov Bear this past week appeared a back and forth between Jennifer in Mamaland and a Yeshiva Administrator, and a Tuition Wrap Up by Dov Bear. In short, Jennifer in Mamaland hates the tuition assistance dance of gathering numerous papers, disclosing every detail in detail, and begging for a reduced rate. She'd prefer a "short form". The responding Yeshiva Administrator doesn't like the dance he has to do to get parents to pay up the money that they agreed to pay in their tuition contract. And Dov Bear is calling for Yeshivot to run themselves more professionally and take collections seriously.

It sure would be lovely to have an honor system and one would think that when you are dealing with a Torah observant crowd, you could rely on an honor system. But unfortunately that was not the case when my husband was in elementary (his father occassionally did some research for the mechanech), nor is it the case today. Case in point would be a recent suggestion from one imamother member to another on how to keep the kids out of public school (which the mother was contemplating after her school closed down this summer) when the money for tuition simply isn't there:

Anyways, I say fight the fight and make sure they stay in torah schools. Tell the schools that your trying to get into that you are getting money from a relative-- make something up, and youll be able to pay in..october.. and then october comes and tell them you dont have it and pay what you can...they can't kick you out- can they? Iknow in new york they are really snobby and its sad. Where I lived, you pay what you could but with one or two schools in the community, they had no choice but to accept you either way. But I just wanna say that eduacting your kids to be religious, Gd fearing Jews should be number one priority for all of us. So I would do whatever I could to send them to Torah Schools. [sic]

Ah, lies, deception, and outright theft: The foundation on which to raise a "Gd fearing Jew." There is no question in my mind that Yeshiva administrators have their plate full when it comes to administering a scholarship system in a way that maintains dignity while trying to maintain some fiduciary duty.

So, the cat and mouse game is nothing new and because it is nothing new, I'd like to present an idea that is sure to be controversial with a capital C-O-N-T-R-O-V-E-R-S-I-A-L. Controversial as the following suggestions might be, they are industry standard practice and should be considered for their merit as the billing and collection games are simply ridiculous (and, yes, I've had a bit of an opportunity to witness this song and dance from the inside. Getting the billing and collections game under control would go a long way towards creating financially stable programming. Additionally, these practices will allow yeshivas (and camps) to create real, usable budgets which allow staff and bills to be paid on time, every time. The budget need not be a guessing game (and you can shave numerous staff hours in the process) when you know just just about how much money you have to work with because:

1. The school has collected most of the money before the first day of school (and builds in a premium for money they will collect later, offsetting possible bad debts).

In my research of private schools, I've noted that industry standard for private schools (especially pricier private schools) is to collect tuition in large lump sums. Ideally a school collects 100% of tuition due before the start of the school year, on August 1st. Different arrangements prevail for those who cannot pay in one lump sum, and extra fees are attached for parents who do not pay in one lump sum. I don't know if charging extra fees is halachically permissible, but I have seen some Yeshiva schools do so also. Some schools collect tuition in 3 larger lump sum payments, some in two. Collections are generally done well before the end of the year.


Now I realize that going to a one lump sum payment won't be popular for a number of reasons (and instituting lump sum payment plan(s), rather than a lump sum payment plan must be accompanied by a trust relationship), but it seems to me that if most tuition was collected before the start of the school year, schools could mostly end this cat and mouse game of collections. Furthermore, schools would basically know how much they have to work with and could plan accordingly.


Obviously, such a plan would be unpractical for parents currently in the system who are living month-to-month, but instituting such a plan for 1st time yeshiva parents is well worth considering in my opinion.


2. Tuition assistance decisions were made before school contracts for the coming school year are signed.

This also appears to be standard industry practice for schools that offer tuition assistance, as most private schools do. The admissions process works as such:

• Students apply for the following school year during late December, early January.
  
• Students applying for financial aid complete tuition assistance forms in addition to admissions forms.


• Schools send out letters of commitment and tuition contracts.


• Parents and students return letters of commitment, signed tuition contracts (and choose their payment plan), and a deposit for the coming school year.


• By August 1st, parents pay a majority of their tuition for the upcoming school year. Even where there are payment plans, the first payment is often the largest.

Parents know what they are expected to pay before they enroll their children in school. Administrators don't need to constantly "juggle" because the ball isn't constantly shifting as most collections take place up front.

3. The amount available for tuition assistance is pre-determined before scholarships are provided and assistance is divided from that pot of money.

Fire away. I realize that industry standard might appear to be somewhat draconian and some might label it "goyish." But this cat and mouse game that Mr. Yeshiva Administrator over at Dov Bear is playing with parents who bounce checks or won't make good on the agreed upon amount is no better.

No white-washing, no condoning, no apologizing on behalf of the desecrators

With thanks for Professor Levine whose website contains information of much value. I have retyped the following Selected Writing of Rav Shimon Schwab as an important reference piece of an authentic Torah approach on how we, the orthodox public, should approach those who "[desecrate] all the fundamentals of Torah Judaism" in their dealings with their fellowman, Jew and Gentile. I really shouldn't have bothered with my own post from last night when this is far more powerful and poignant; speaking directly to the point, the words penned in the 1970's are as true then as now. My apologies for not having Hebrew a Hebrew typepad on my computer currently. If someone is kind enough type of the few pesukim in the essay in a cut and paste format, I'd like to add them. I've highlighted a few things in the essay below (twas hard to choose).

46* Chillul Hashem

Whenever we gather in prayer invariably we do recite or respond to the words of Kaddish: “May His Great Name be magnified and sanctified”. And whenever we introduce the daily Kedusho we call out: “Let us sanctify Your Name in the world”. And every so often during the course of our Tefilloh we emphasize our desire to belong to the sanctifiers of the Divine Name amongst men true to the injunction contained in Vayikro (22, 33) (“You shall not desecrate My Holy Name and I shall become sanctified in the midst of the children of Israel.”)

The second sentence of Sh’ma Yisroel begins with the command: “You shall love Hashem”, which is interpreted by our Sages: “Let the name of Hashem become beloved through you.” In other words, we are supposed to lead the kind of exemplary life which would contribute to the universal adoration of G-d and which would, in turn, enhance the glory and luster of the Torah, adding respect for the dignity of the Jewish people as a Kingdom of Priests and a Holy Nation.
The very opposite of the sanctification is the desecration of the Name as condemned by the Prophet with the scathing words (Yechezkel 36): “The came to the nations and desecrated my Holy Name, so that one said to them, is this the people of G-d who came from His land?”

Every form of Chillul Hashem lowers the awareness of the Divine Presence in the world. But if the desecrator happens to be a professed Torah observer or, even worse, a so-called scholar of the Torah, then the Chillul Hasehm not only weakens the respect for the Torah on one hand, but strengthens on the other hand the defiance of the non-observer and adds fuel to the scoffers, fanning the fires of religious insurrection of all around. Chillul Hashem is responsible, directly or indirectly, for the increase of frivolity, heresy and licentiousness in the world. Therefore, we should not be surprised reading the harsh words of condemnation we find in the Talmud: “He who has committed Chillul Hashem, even Teshuvoh, Yom Kippur, and suffering cannot fully atone for his sin until the day of his death (Yoma 86).”

“Better to commit a sin in secrecy than to commit Chillul Hashem in public (Kiddushin 40).

“The is no delay in the Divine punishment for Chillul Hashem, whether committed knowingly or unknowingly (ibid.)”.

“If one steals for a non-Jew, swears falsely and dies, his death is no atonement for his sin because fir gus sub because of Chillul Hashem” (Tosefta B. Kamma, 10).

“He who desecrates the name of Heaven in secrecy is punished in public” (Avoth 4).

“All sins are forgiven by G-d but Chillul Hashem He punishes immediately” (Sifri Haazinu).
This is but a small selection from the many fierce condemnations addressed by our Sages to the desecrators of the Divine Name.

All this comes to mind at this time since some perpetrators of Chillul Hashem are making the headlines of our daily newspapers. Certainly we are not sitting in judgment of the persons who are publically accused and we have to wait whether the indictments will be borne out by irrefutable evidence. However, be it as it may, the Chillul Hashem is there in the worst possible way. “Rabbi” so and so, who sits in court with his velvet Yarmulka in full view of a television audience composed of millions of viewers, is accused of having ruthlessly enriched himself at the expense of others, flaunting the laws of G-d and man, exploiting, conniving and manipulating – in short, desecrating all the fundamentals of Torah Judaism. And this sorry onslaught on our Jewish sensitiveness is repeated by similar allegations, proven or unproven, involving more prominent men who are stigmatized as orthodox Jews, sometimes even with so-called rabbinic diplomas.

While it is obvious that the vast majority of loyal and observant Torah Jews deal honestly and correctly with their fellow men, a very small minority of criminal perpetrators suffices to cast sinister aspirations on all orthodox Jews and, what is worse, on orthodox Judaism as a way of life. The Chillul Hashem of a few individuals provides excuses for the doubter, and encourages the desecration of Torah learning, Torah education and Torah influence. To defraud and exploit out fellowmen, Jew or gentile, to conspire, to betray the Government, to associate with underworld elements all there are hideous crimes by themselves. Yet to the outrage committed there is added another dimension, namely the profanation of the Divine Name and that means the profanation of all that is supposed to be held sacred by us as well as – in their heart of hearts –by the perpetrators themselves. What a sorry picture that is.
Suppose I have cheated my neighborhood or my Government and then I stand in the midst of a congregation of honest and decent men and women to recite the Kaddish which is the prayer for Kiddush Hashem in the world. What audacity! What a shame! Can there be a worse contradiction than the strict Sabbath observer who may also be a stickler for Kashrus and who at the same time violates the spirit of Shabbos and Kashrus during the week with non-kosher money manipulations?

Let us repeat. The profaners and the desecrators are only a handful of unscrupulous people and we even hope that some of them will be proved innocent. But it needs only very few violators to give us all a rotten name, aiding and abetting our many adversaries and antagonizing our few friends.

Therefore, no white-washing, no condoning, no apologizing on behalf of the desecrators. Let us make it clear that anyone who besmirches the sacred Name ceases to be our friend. He has unwittingly defected from our rants and has joined our antagonist, to make us all suffer in his wake. And – noblesse oblige – the more prominent a man has become in orthodox Jewish circles the more obligated he must feel to observe the most painstaking scrupulousness in his dealings with the outside world.

Our observance of Torah and Mitzvos is regulated by the Choshen Mishpot, the code of social justice no less than by the other codes of the Shulchan Aruch. Whoever betrays his loyalty to one portion of the Torah uproots all others. For, at the roots of Chillul Hashem are gross materialism, blatant selfishness, insatiable love of wealth and brazen disregard for common decency. Even if, strangely enough, as it sometimes happens – those with ugly traits go together with excessive charity and benevolence. We call the type of twisted ethics [mitzva habaha beavreirah] i.e. virtue acquired by sin, which is worthless – less than worthless. It is a travesty and a farce. It means playing jokes with the Torah. It is blasphemy and therefore unforgivable. Let us proclaim, loud and clear, that we shall have no part of such sickly “Yiddishkeit”. Our aim is to strive for Kiddush Hashem. And in order to reach this goal we shall band together and march together, we and our children [] with clean hands and pure hearts towards the dawn of Geuloh, speedily in our days.

The Criminal Element Takes Another Public Seat at the Dais

Crime and punishment is as old as the Torah itself. But it seems that in the past year that prominent communal organizations and segments of the Orthodox community have become very loud and bold in their public defense of convicted criminals within/affiliated somehow with the Orthodox community. So called pidyon shuvuyim campaigns to collect for the legal defense and make life more manageable for the wife and children of the convicted is nothing new. But large scale, broad based, and loud public support seems to be a new trend that has developed, I would say, in just the past year. It appears to me that there is a hashkafah of sorts that is developing and it reads like this: Hands off US.

I don't remember rallies or mass letter writing campaigns in support of the drug/money laundering rings of the mid-90's that spanned from NY to LA, but the issue wasn't exactly on my radar. There was a time where I owned a pair of pink tinted glasses and I'd like them back, thank you very much! And while there must have been some behind the scenes lobbying for President Clinton's pardons of the New Square group, when the news hit of the pardons (Jan. 2001), I believe it was the first that most people in the Orthodox community became aware of the crime (granted, the internet was only in its infancy). But my recollection of the aftermath was that most hung their heads in shame. But, I could be mistaken.

In 2009, the Agudah organized a number of business Asifas. These spawned from the arrest and subsequent conviction of the Spinka Rebbe and the New Jersey and New York stings in which arrests for money laundering were made in Deal and Brooklyn. Despite comments on blogs to "hang the mosser[s]" the public reaction of the Agudah leadership was not to organize letter writing campaigns, protests, or fundraisers. One could question is inviting the Rebbe to speak as an honored guest at a business asifa dedicated to promoting integrity was in good taste (I'd vote no since too much blame was placed on a "lack of education" when it is obvious to someone educated in such matters that you have to know exactly what you are doing to pull off massive fraud schemes***), at the very least there was some show of contrition, even if it was perfunctory. At the time of the Spinka arrests, Rabbi Adlerstein, wrote that there was a Silver Lining to the LA Scandal. He hoped that this case would be used to "reexamine issues of personal honesty and integrity" and pointed to some mussar shmoozes. I disagreed with the conclusion that these crimes were borne of insularity^^^, but shared the hope that in the internet era where stories

Well, here we are mid-2010 and it seems that promoting integrity and adherence to American Law and Choshen Mishpat might be a thing of the past. Early 2010, the Grossman Circus rolled into town. A number of Orthodox Communal Organizations, not just the usual suspects (!), banned together in a campaign that loudly called for staying the execution of a man who brutally murdered a young park police officer. The organizations involved even called in the Pope! From coast to coast, Orthodox Jews were asked to write sign petitions, write letters, and call the Governor of Flordia's office to try and stop the execution. And the community followed orders. Certainly leadership was aware that there are more than a few loose cannons that would come out of the woodwork, and the loose cannons didn't disappoint, harassing the Park family and continuing the circus with a funeral fit for a Rebbe and emotional hespedim. Treated a ba'al teshuva of high caliber (the words "ahavas yisrael" follwed his finaly Shema) despite the fact that he never was able to connect the words "I" with the "events" (i.e. murder) before his execution. On Tisha B'Av, his headstone was laid and the labels of HY"D, kedush, and hopes he will be a matzliach yosher continue. Not an ounce of tzniut was evident in this campaign!

Summer 2010, Lakewood hosts massive asifot for Rubashkin, raising upwards of $300,000 for his defense. Ten thousand are reported to have attended the men's gathering and another 3,000 the women's rally. We can argue whether or not the sentencing was excessive, and it may well be (I'm not a legal scholar, but I do know that it was within legal guidelines). But what is the ultimate message of such public and loud campaigns? What kind of society are we going to create when instead of dipping our heads in shame we loudly proclaim the great righteousness of the convicted? What kind of society are we going to create when week after week publications reinforce the notion that we live in tzarist Russia and are simply being persecuted for being Jewish? As far as I am concerned, the message being given is that corners can be cut (so long as you give plenty of tzedakah, bring the community together in achdus, or engage in great displays of Yiddishkeit).

Even worst, during the 3 weeks, a Yated columnist went so far as calling those who don't rally behind Rubashkin as having a "Goyishe Kop": "If I would not know better, I would say that they have stopped thinking in the traditional thought pattern of Yiddin throughout our galus." I'd counter that perhaps those of us with a "Goyishe Kop" are simple people who have no interest in mental gymnastics. While we have compassion for a fellow Jew, we don't act out of sheer emotion. We want to live our lives in a straightforward way where we represent ourselves in dealing with simple straightforwardness. We don't care to engage in mental gymnastics where we convert the distasteful and wrong into a mitzvah. We believe that callousness to financial crime indicates a breakdown in society and do not choose to gloss of things that are "if anything is a white collar crime." We understand the ramifications of our actions as they have consequences far beyond that of a single person and we understand that failure to recognize the rule of law will eventually bite us in the butts!

And so it has. July 28, 2010, Chabad annouces a public rally for a man who was brought to justice by those in his own community. (Background stories at VIN). And note that the ramifications of such a rally extend far beyond providing the $300,000 needed to continue paying the lawyer for legal defense. The ramifications are societal. There is callousness towards other people's money and property. There is an attack on the rule of law, a rule of law that protects me and you, our lives, our children, and our property. Try this on for size and if you watch this video, tell me what background piano music you are hearing)

"Him sitting in prison will not help anybody pay their bills. We have a moral duty to help him reunite with his family speedily."
"No children deserve to grow up without a father, especially such young children, and an oldest child who sacrificed himself for Jews in Eretz Yisroel, losing his arm in Gaza." [Really, no children!?! When will the gatherings be for the thugs that are sitting in prision for beating a Jew? Stealing from a Jew?]

Let's realize the consequences of our actions before we dig a hole so deep it is impossible to emerge from it. The message I'm getting from this year of public displays is me, me, me. Public displays of achdus might feel good, but quiet behind the scenes campaigns where appropriate will keep emotions at bay and preserve a sense of wrong and right. I'm not a sociologist, but I sense a change in the direction of certain elements within the Orthodox community and I think some reflection as to what this changes means for the community at large is well in order because actions always have consequences.


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****What I wrote at the time: Setting up a tax fraud scheme where hundreds of individuals "donated" millions of dollars and then itemized those donations when they knowingly received an 80-95% rebate is planned, deliberate, intentional, malicious, and illegal criminal activity. This isn't giving in to a small temptation such as deducting the price of your tickets to a Chinese Auction. This took massive manpower. Such a scheme perpetuated from the top and joined in by a hundreds of people speaks volumes about the lack of integrity, the worship of the dollar, and the precarious financial situation of the Orthodox Community as a whole, as the Chassidish community in particular.

^^^What I wrote at the time: "insularity combined with ignorance can bring out the yetzer hara for small crimes, but arrogance combined with desperation is the brainchild behind such complicated schemes as we have been continually witnessing for at least 20 years."

For Two Weeks a No Show

Two weeks ago I got work that management of Kol Yisrael Areivim was going to appear on the Zev Brenner Talkline program to "clear up the misinformation and rumors spread on the Internet." Being that I hosted the second blog post regarding Areivim that I know of I tuned in last motzei Shabbat. The planned program was postponed because of "new" and "exciting" breaking developments. Tonight (motzei Shabbat, June 13, 2010) I once again tuned in and again the program was postponed, this time because the organization was putting together their documentation, instead I'm listening to an extended and heated Q and A with a frum lawyer about why ponzi schemes seems to hit the frum community hard. How timely!

There are a lot of defenders of the KYA program and the second postponement by KYA should raise some really huge red flags for those who still believe this program could work. This organization didn't develop yesterday. KYA was formed in 2005 (5 years ago). In February of 2007 (3 + years ago), Jonathan Rosenbloom posted an editorial "Look Before You Leap" at Cross-Currents. In his editorial, he pointed out a number of concerns with the program calling it too good to be true. But he nevertheless endorsed the tzedakah aspect of the program calling it an "improvement" over the current situation. For the most part, commentators including seasoned actuaries, chimed in decrying this program.

Now we are in 2010 and following the guest post I hosted, the second such post that I know, Rabbi Horowitz took up a conversation with KYA management, the 3rd post dealing with this organization that claimed in their response to Rabbi Horowitz that the organization has been checked out and endorsed by actuaries, CPAs, and lawyers, to say nothing of Rabbis and community officials. Following this post, KYA pulled the endorsements of the Agudah, NCYI, and an official from the OU were pulled from the website.

Rabbi Horowitz's first post of a handful went up on May 17, 2010. Nearly one month later after that post and 5 years after the founding and marketing of the organization through numerous print and Internet advertisements, the organization is unprepared to go on Talkline defend their program and "clear up the misinformation". Either the research has been done or it hasn't been done! I've written audit reports. In fact, I have an entire stack of such reports sitting in my home office. With a quick review of any of my reports I would be half prepared to talk about work I did a decade ago. My papers have been used by auditors who came after me and they have been examined by outside lawyers and auditors. Such is how a professional office is run. It is truly astounding that for for 5 years KYA and others (Areivim and Areivim USA) have been able to advertise and collect funds without making nary a blip on the radar. Now that they have been put on the radar, they have been unable to go on the air and talk and take questions for no more than 2 measly hours, much of which is interrupted by commercials and buffered by the back and forth with Mr. Brenner. This is just downright terrifying!

Think of how much money has been poured into this program that could have been used to start up a tzedakah to help families fill in the gap to buy REAL life insurance, i.e. the type that pays upon death with no strings attached and allows a family freedom to use the proceeds as they see fit (rather than throwing some interest income their way until the time when a child might qualify to use the lump sum to get married!). Think of all of the people who have bought into this program, passing up opportunities to buy REAL Life Insurance at more affordable prices. Think about the families that could have bought REAL Life Insurance 5 years ago but are now no longer able to do so because they have been hit by the unthinkable.

So will KYA make a showing on Talkline next motzei Shabbat? I really hope so and I hope that readers will take an interest and pepper management with questions and educated commentary. It really shouldn't take this much time to get your docs together KYA. You've been around since 2005. Your docs should have been in hand then!

Guest Post: AREIVIM and Why I Don't Like IT

With great thanks to "Old Frum Actuary" who is publishing a response to a heavily advertised plan by the name of Areivim that I believe is a disaster waiting to happen and is nothing more than a poorly conceived tzedakah disguising itself as life insurance. Like my guest poster, I don't care how big names appear as endorsers. The math simply doesn't work and the level of accountability is low, to put it politely. Regular readers know that I don't regularly publish the name of a tzedakah organization when I comment on trends, but I am making an exception because I feel so strongly about the important of life insurance and I believe that anyone who enrolls in this plan is not only buying into something that is simply unsound, but is playing into a trend of form over substance, and ultimately delaying an introduction of substance. Guest post follows:
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AREIVIM and Why I Don’t Like It
By OLD FRUM ACTUARY

This is just my opinion so you are more than free to disagree. Of course some numbers to back up any counter claims should be a requirement.

Here is the Areivim plan:
A group of 14,286 (families) enroll by submitting an application and a credit card number. If someone in the group dies, the remaining members will be charged $7 per surviving unmarried child, for a total of $100,000 per child. No more than $28 will be collected per member per month. For example, if someone dies and has 7 children, the first month’s collection will be $400,000 (14,286*$28) and the second month’s collection will be the remaining $300,000. If there are no deaths, there are no charges.

Now for the problems:
With 14,286 people and a maximum charge of $28 a month, the maximum amount that can be collected in one year is 14,286*$28*12 = $4.8 million. This means the maximum number of children that the group can pay for in any year is $4.8m/$100k = 48 per year. Since this arrangement is marketed to the Chasidic and RW communities, I am going to assume that the average family has 6 children. With an average of 6 kids per family, that means the fund can handle no more than no more than 8 deaths per year.

How many deaths can we expect from a group of 14,286 people? The answer of course depends on the age of the cohort. But from the mortality tables I looked at, there is no way that this will work. Remember, that there is no underwriting. Furthermore, the latest mailing states that not only will they give $100,000 per child, they will also give money to a surviving female spouse with 3 or more children. Last, it also appears that they will pay money to the surviving children whether it is the father or mother who pass way. This means that in the cohort of 14,286, there are actually over 28,000 people at risk for dying. Assuming 8 deaths or less from a group of 28,000 is well below any mortality table at any age.

Another question I had was as follows: As more people die the group gets smaller, so that later deaths do not have 14,286 people each chipping in $7 per child. So unless there is a constant flow of new people signing up and paying, by definition the plan fails. And any plan that requires constant new entrants to be able to pay the older ones is not an insurance plan but rather a Ponzi scheme.

Furthermore, credit cards get cancelled or expire. Who is going to track down the large number of uncollectable funds after each death? Isn’t there a cost for collecting money out of credit cards? Who is paying for that?

Yet another issue I have is regarding their rule on what happens to the $100k after collection. According to their brochure, ‘special accounts’ will be set up with the oversight of rabbonim, run by askonim who will distribute the money over time, to and through the wedding. I am pretty sure that Bernie Madoff himself would have passed the “rabbonim oversight” test. If there is any potential for fraud and abuse, this is it. Having a multi-million dollar fund in the hands of an ‘askan’ is a recipe for disaster. And cynics like me will be the first to point it out to anyone who asks.

Last but not least, are the distortions and outright lies in their most recent mailing. The brochure begins by stating that after two years the program is working, so all the naysayers were wrong. First, I am not sure two years would be enough time to prove any such thing. Second, according to my sources inside the organization, they still do not yet have a cohort of 14,286 people, so how can they say this? Third, this statement is completely un-auditable. We have no idea how many people have signed up, how many deaths there were, and whether or not outside collections were used to pay for them.

Later in the brochure they state that as of now 3 out of every 5 people have not yet signed up for Areivim. Using my brilliant analytical skills I determined that they are therefore saying that 2 out of every 5 people have signed up. Do you believe that 40% of Klal Yisroel has signed up for this plan? Let’s put it this way, do you know anyone who has?

The brochure also says that ALL the Gedolim in EY and America have endorsed it. Well, my son’s Rosh Yeshiva put up a sign in his Yeshiva saying that he doesn’t; though perhaps all that proves is that my son’s RY is not a Godol. J My Rov was also asked to endorse and he too refused.

The brochure makes mention that the number of deaths experienced so far is far lower than ‘Al Pi Derech Hatevah’ (expected). This is in fact quite possible even if I can’t audit them. And perhaps that can be their selling point - join Areivim and Hashem will bless you with a lower-than-expected mortality. But I think we are all better served by buying insurance from a reputable insurance company, with an annual financial statement and appropriate reserves, that pays the beneficiaries upon death.

Shameful

Again, really? Let the jury hear the evidence. But it is disturbing just how often some names seem to reappear. [Updated: Those with the patience can read through the case here. I've done some work in fraud. This one is really different imo].

.459 Blood Alcohol Level (for the math impaired, .08 and you can be arrested on a DUI in many states). And it isn't even Purim yet. The Rabbi has been charged with a misdemeanor. The Rabbi's lawyer says the number isn't accurate. Furthermore, the Rabbi and his wife claim they didn't know the kid was drinking until he threw up. Thankfully someone called EMS since this all happened on a Friday night. Just be glad he is alive. VIN commentors don't like the VIN headline: Child Drank To Unconsciousness At Rabbi's Friday Night Party. Perhaps you have to be a parent to understand.

Commentor #1 thinks "the man" is out to get the Rabbi. Commentor #2 recognizes that the readily available alcohol in campus Chabad houses is problematic. And commentor #8 says, hey that isn't a problem, no one would show up if there wasn't alcohol. I can think of at least one student from my alma mater who came to the Chabad House of Purim, saw the drinking going on by the teenagers in the community, and never returned. There are many campus outreach programs reaching students without the booze.

Meanwhile, Cross-Currents has Rabbi Shafran's response on the Martin Grossman campaign. I don't know if my comment will be published, but I think that the leaders at the Agudah should read every single comment on YWN, VIN, and Matzav. Perhaps they expressed the greatest sympathy for the Park family, but they need to educate themselves on what transpired due to this campaign because it is seriously shameful.

Have You No Shame? Shoplifting

Yet another installment of Have You No Shame? My previous posts were all about fraud against the government advertised in public. But this one is about ripping off a real person, a small business owner. See Rabbi Fink at Dov Bear regarding sheitel theft.

For years I've heard about people making returns of used items and how many frum clothing retailers will no longer accept returns because women would buy clothing, wear it once, and then bring it back. Now a report about sheitel theft of multi-thousand dollar wigs.

I guess we have moved from ripping off anonymous taxpayers, to petty theft, to full fledged grand larceny. I guess none of the thieves are brazen enough *yet* to mug a women for her wig. Strange world we live in.

Remedial Education Funding Would Not be My Argument for Vouchers

VIN has published another pro-vouchers article from Josh Pruzansky (Executive Director of Agudath Israel New Jersey), as has Rabbi Boteach. Two in one day. This might be a record.

My regular readers know that I support vouchers from an ideological standpoint. And while I have addressed the subject of educational choice, which incidental extends far beyond the subject of school vouchers as Josh Pruzansky points out, I'm not holding out any hope of seeing a voucher in my lifetime. Despite my support for politicians who share my ideological view, I'm not quite sure that vouchers would be a blessing for our communities. But this is perhaps a subject for a future post as the subject is sure to rear its head from now until the day when the community decides that perhaps it is time to concentrate efforts on solving the tuition issue more internally. Perhaps a concerted effort to consolidate schools, throw support behind present and potential future homeschoolers/groupschoolers, enacting minimum tuitions or at the very least collecting agreed upon tuitions (see my last post).

But back to the articles at hand. If you are lobbying for public education funding to be earmarked for private schools, particularly yeshivot, what arguments do you think will be most effective in winning the hearts and minds of politicians and taxpayers who are on the fence so to speak? What arguments might sway parents who might fear adding more students to the role of the taxpayer? What arguments might help convince taxpayers that private schools can do a better job than public schools at a lower cost?

Personally, I would 'vote no' on using the $24 million of earmarked funds in New York that are funding remedial tutoring for *10,000* yeshiva students as an argument for why the taxpayer should hand over governmental funding for parents desiring a yeshiva education. Now certainly where remedial tutoring is needed and where there are outside funds available, I would see no reason not to lobby for remedial education funds for the sake of remediation. But as an argument with the ultimate goal of securing support for the elusive school voucher and/or greater funding for yeshivot. . . no way! The taxpayer isn't interested in a superior gemorrah shiur. The taxpayer wants students graduating with a strong grasp of the three R's. If you aren't able to provide that, I'm afraid the taxpayer isn't going to be too impressed, even where "the government saves by having children in a values-based education system which produces far lower delinquency rates. [Rabbi Boteach]" .

And, to finish up a quick post. . . . . perhaps VIN should reconsider its choice of photo for an article on educational choice. The photo of choice was taken on the day that FBI agents went into the Deal Yeshiva to seize records to investigate a money laundering ring for which community Rabbis were arrested. Not a smart choice for a photo in my opinion.

(Perhaps a kind reader can email VIN with this commentary. I've never got very far on posting comments there).

Update: Google Alerts alerted me that the Agudah had the article published in the Asbury Press. It should be interesting to see the comments that get published. At this time only one comment is in with the introduction "entitled?" This type of article simply does not speak to the American public. It is far too centered on one community.

Social Ills and Dependency

I have some posts in my lineup on tuition, but I'd prefer a diversion of sorts. (Sorry, it isn't a big diversion).

Rabbi Wein has published a most fantastic article titled No Free Lunch. The economics of human behavior is inescapable and for a long time I've been saying that you can't create a dependency class without experiencing the ill social consequences that come along with dependency. This is why, even if we had unlimited resources, I wouldn't fund my children's every desire, whether that desire be some gedolim card collection or the avoidance of making a living because I simply don't believe it is good for their development. Certainly our sages recognized the dangers of dependency, idleness, over consumption, entitlement, and reversing gender roles.

If I was an Orthodox economist living 30 + years ago when the community embarked upon some of the current practices that permeate the scenery today, I hope that I would have tried to sound the alarm because regardless of the economic climate, many of the practices that are commonplace, certainly aren't commonsense.

Rabbi Wein brings his own touch to the message that you can't have "a free lunch is always present and eatable without later consequences." He touches upon dependency, governmental arm twisting, fraud, dependency, kollel, (lack of) employment, begging, and dysfunction. . . basically all of the Orthonomic subjects we talk about here.

And this story is just so illustrative. Here is what happens when the only "trade" you teach your children is begging:

I am aware of a case where a man who traveled often to collect money solely on his own behalf, when he passed away, the asset that his sons fought about and actually contested in a rabbinic court was his list of donors. A generation brought up to believe that there is no
necessity for it to work in order to make a living for one’s family is doomed to a spiritual and social disaster - and eventual self-destruction. There is no free lunch for anyone in this world.

Classic!

Heed these words and try to spread the wisdom. You can't escape the ills of dependency anymore than you can escape the laws of physics. Of course, there are those in the klal who think frum Jews can escape all of the above.

And, while I'm at it, I can't help but point out another article that relates directly to the subject at hand. The JPost has an article titled "Most haredim want secular higher education, survey finds." The study quoted basically shows that haredim are interested in higher education under certain conditions. Fine and well.

But the interesting part of the article to me is the disparity in desire between men and women: "63% of female respondents said they would, while only 41% of males were interested. "
Hassidim were more open to secular learning, with 59% answering in the affirmative, while only 42% of the Lithuanian respondents said yes.

Note the 22 point difference between men and women answering in the affirmative. I imagine I can't make any scientific declarations as the study did not concentrate on the disparity, but I can't help but think that the men have become far too comfortable with the gender role reversal and dependency. I believe it is a very natural, masculine quality to want to work and support a family. But it seems that normal inclinations have been broken and many men have been emasculated. I can't help but think about the commentary on what the slavery in Mitzrayim entailed. One commentary, as I recall, states that the slavery consisted on having the men do women's work and having the women do men's work.

Also note the difference between Hassidim (male and female inclusive) and so called Lithuanian respondents, a 17 point difference. Here too I believe we are seeing the effects of dependency.

Comment away.

Preventing Torah Scroll Theft

Hat Tip: LOZ

Speaking of Sta"M:

Internal controls was an interest of mine when I worked full time in audits. I still love hearing about new developments and a development to protect religious assets is of great interest. Machon Ot has developed methods of both identifying and registering Torah scrolls and if they can register critical mass it is believed that those who steal and sell Torahs on the black market will realize it is at their own risk. It is a shame that this development has to take place, but from an academic standpoint it is an interesting internal controls development. And anything that can help reduce the temptation of theft gets a thumbs up in my book also. Hatzlacha to Machot Ot!

Have You No Shame?:
A Tiferet Sta"M Advertises his Level of Observance Bein Adam L'Chavero

In addition to "Ask Orthonomics" and "Bad Financial Advice" titles, I'm adding another one and amending the title of a previous post so that topics of a similar nature fall under the category "Have You No Shame?"

Jonathan Rosenblum has a column up on Cross-Currents that was printed in Mishpacha in response the Deal ordeal, which sadly can no longer be labeled the newest fraud investigation/case, regarding yashrut which has some nice lines from Rav Shimon Schwab and the other sources.

One commentor recalls a recent situation and asks for advice:

"I recently purchased talis and tzitzis at a Sta”M store in a large and well-known frum community in the US. The sofer was busy at work when I got there, and stopped to help me select the right size and fit (who knew there were different talis fits these days). When it came time to pay he quoted me a round number. When I pulled out my credit card he said “well in that case we’ll have to pay Uncle Sam” and proceeded to calculate the tax. I usually do not carry much cash, but had just been to the ATM machine and had enough to cover this relatively small purchase. Without thinking much, I handed over the cash and was nichshal be’aveirah.
As I was leaving, I saw that same scenario play itself out with another customer in the store who was picking up mezuzos, (and paid cash).
Before I start moralizing, its obvious that I participated in cheating the government every bit as much as the sofer. And to that end, I’m asking for eitzoz for what might be a proper takanna. (I cant just send the state of __ a check for the money owed.
But I also cannot stop wondering as to the kashrus of the Stam and other articles sold in this store. Was everything done and checked kadas ukedin? Probably. Does it matter? Not sure how to think about it. Chaveirim, please advise."

This was my advice:

I can only hope that the sofer who we have bought tefillin and mezuzot from are honest businessman. I can’t imagine how an item that is acquired through such means is truly kosher.

But, no matter what the price and no matter what the method of payment is, as per tax law, he is the one responsible to make an accounting and pay up, although I too would feel like a participant in tax evasion for handing over the cash rather than a check or plastic for the purchase after he basically advertise the intent to defraud.

It would take a bit of a backbone, but perhaps you could march into the store and return the items for cash back and let the store owner know exactly why and that you want to be kosher with all of your dealings and later buy the same item from a sofer who, at the very least, has the good sense not to state his intents to defraud (can you imagine someone stating his intent to cheat on his wife or break Shabbat to a stranger that walks into his store?).

Beyond that, perhaps you can call the owner and inform him that cash is also taxable, speak to a Rav regarding the sofer’s practices since such advertising could potentially be an issue for the kehillah, or just try to go forward by paying through check/debit/credit and rest easy knowing that he, not you, is responsible for the taxes no matter what the method of payment.

After I posted my comment I did have the thought that he could claim sales tax on his own state tax form by claiming a purchase was made in a state without sales tax for that amount. This would take care of one aspect, but certainly wouldn't take care of the social security, medicare, federal, and state income taxes owed.

I'm not sure what I would do if I was the one to hand over cash after such a statement. I rarely think twice when I had over cash for a good or service because corportations and business are responsible to take care of their taxes, not the consumer. If I spend time feeling responsible, I simply wouldn't be able to step out into the marketplace! On a similar vein, those who engage in banking, tax services, or accounting/bookkeeeping know that you can't police every transaction, although sometimes it is prudent to drop a client because you simply can't trust them.

Please add your own advice in the comments section, especially if you have been in a similar situation.

Have You No Shame?:
Don't Try This At Home

Ariella posts an ad that appeared on a public forum which reads as follows:

"Perfect as part time or telecommute: We need you to search the internet and databases (will be provided) for potential customers. Will pay $12 an hour in cash weekly (this is the equivalent of $24 an hour on a 1099). Must have some experience in business, research, sales, insurance etc to be able to define a "Qualified Potential Customer" Please contact us____"

Whoever takes this cash job should be prepared to cough up 14.1% for employment taxes (92.35% * 15.3% * profit) plus their federal marginal rate + their state marginal rate.

Just because your employer doesn't intend to issue a 1099 to a (presumably legitimate) contractor, doesn't mean the IRS won't want their cut when they come a knocking. I know someone who took a cash job and was ultimately stuck with the bill + interest + penalties because he didn't want to be a 'moser' and defend himself against the employer who could not claim he was a contractor in the least.

Anyone who takes a $12 an hour contracting job and ends up getting audited is going to feel really stupid when the bill arrives. You certainly run the chance of stealing not only from the government, but from yourself!

And to the businessman: don't let the newest scandal get in the way of announcing your intentions to evade taxes on a public listserve. Have you no shame?