Bernard Madoff's alleged $50bn (£33bn) financial fraud reverberated in Israel yesterday, with concern being voiced by some about a possible antisemitic backlash.
One of the country's most respected private educational funders, the Chais Family Foundation, which disburses $10m annually in Israel and another $2.5m in Eastern Europe, has been forced to shut down.
Israeli and American Jewish leaders involved in fighting antisemitism said they were concerned that although many of Mr Madoff's victims are foundations belonging to Jews – reportedly including ones affiliated with Steven Spielberg, famed holocaust survivor Elie Wiesel and US real estate magnate Mortimer Zuckerman – people with an anti-Jewish agenda would focus on Mr Madoff to forment hatred. "Always when Jews are in involved in something terrible and negative like this it can be misrepresented. Antisemitism is not a rational process," said rabbi Michael Melchior, an MP who headed a forum against antisemitism. "Jews are like other people, there are good and bad. This scandal was not only done by a Jew, it hits Jewish charities and things crucial to Jews."
Among Mr Madoff's American Jewish victims is the Jewish Federation of Greater Los Angeles which says it has lost $6.4m or about 11 per cent of its assets as of December. The Chais Family Foundation, which funds student scholarships, teacher training and university research, was yesterday in the process of notifying its 77 Israeli recipients that they would receive no more funding because it is closing. "We have been obliterated," said Avraham Infeld, its president. Only last week the foundation had approved a project that would have placed a thousand computers in classrooms in northern Israel. "Last Thursday Mr Chais called me and told me the man he had invested with for 35 years was a crook and the foundation was without a penny."
Ken Jacobson, the New York-based deputy director of the Anti Defamation League, whose mandate is to combat antisemitism and bigotry, said "We expect the antisemites to have a field day. They will exploit it."
He termed the scandal "a real tragedy for the Jewish community. A lot of people were deceived by this person-a lot of Jewish charities and institutions took the biggest hit".
Mr Madoff was chairman of the business school and treasurer of the board of trustees at Yeshiva University, an orthodox Jewish institution in New York. He resigned his posts on Friday. The Madoffs were also significant contributors to the United Jewish Appeal-Federation of New York.