Israeli-Russian billionaire Arcadi Gaydamak has frozen a giant $50 million gift to the Jewish Agency, which he had announced during a ceremony in January 2006.

At the ceremony, conducted in the presence of Jewish Agency chairman Zeev Bielski, Gaydamak said he would provide the money to finance activity in the Russian Jewish community.

The agreement between the parties, which spread the payment over five years, gave Gaydamak representation at various Jewish Agency institutions. Put otherwise, Gaydamak's representatives would have a say in the way the money was used.

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The Jewish Agency planned to call a press conference to commemorate signature on the agreement. But the police criticized it for accepting a donation from a person under investigation for alleged white-collar crimes, and the press conference was canceled.

However, the signature did take place and Gaydamak handed over the first $10 million. However, sources near the tycoon claim that the Jewish Agency failed to appoint a representative on Gaydamak's behalf to the management board.

Also, the Jewish Agency did not use the money for Jewish Russian activity: if anything it scaled back its activity in Russia, claim Gaydamak's associates.

In January this year, Gaydamak was to have transferred another $10 million to the Jewish Agency. He never did pay the money. Jewish Agency sources said his actions aroused criticism inside the organization, which had raised money in the U.S. based on the pledges from Gaydamak.

The Jewish Agency commented that based on his familiarity with the assimilation of Russian Jewry and the widening social gaps in Israel, Gaydamak had decided to donate $50 million to the agency, to finance Jewish-Zionist education in the former Soviet states, through both formal and informal education, and for special projects to narrow educational gaps in Israel's periphery. "So far Gaydamak has transferred $10 million, in 2006. The money served and will serve these purposes.

"We are confident that Mr Gaydamak will complete his donation, helping tens of thousand of children in the former Soviet Union to become closer to the Jewish people and to Israel, and to help thousands of children at risk in Israel to aspire to a better future."

The Jewish Agency said it respects Gaydamak's philanthropic activities, as shown in his very generous donations to the Agency itself and to other entities in Israel.