From Textiles to the West Bank: Unraveling the Story of One the Main U.S. Donors to the Settlements

The Central Fund of Israel is based in the NYC offices of a textile company, but a Haaretz investigation shows the group has received tens of millions of dollars in donations - funneling much of it to the settlements.

Uri Blau
Uri Blau
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A composite image showing the Chrysler Building in an aerial photograph taken over New York and a partial view of the Israeli settlement of Qadumim (Kedumim), near the Palestinian town of Nablus.
A composite image showing the Chrysler Building in New York and a partial view of the Israeli settlement of Qadumim (Kedumim), near the Palestinian town of Nablus.Credit: Bloomberg, AFP
Uri Blau
Uri Blau

“Jay Marcus to the front,” the receptionist calls into the intercom. It’s around 3:00 P.M. on the third floor of 680 Avenue of the Americas, in the heart of Manhattan. A man in his late fifties, with thin, grey hair, a kippa on his head and a blue, button down shirt, approaches the front desk.

Jay Marcus says he is busy these days, clearing up the apartment in the Upper West Side of the city where he was born and grew up. His parents immigrated to Israel a few years ago and now he has to clear the apartment.

Marcus is head of inventory at “Marcus Fabrics,” a family-owned textile business established over a century ago. The business is run out of NYC, but none of the company's factories are in the United States. It is not a good time to be in the textile business, Marcus explains.

He is a modest and pleasant man, though highly suspicious of the reporter standing in front of him. Perhaps because textiles is not the only operation he runs from here. Marcus is also the key person behind The Central Fund of Israel, an organization that serves as a funnel (a word he resents) between the United States and non-profits in Israel, many of which operate in the settlements.

The plain New York City offices of a textile company from which the Central Fund of Israel is run.Credit: Uri Blau

According to Haaretz's investigation into the flow of tax-exempt U.S. donations to groups supporting the settlements, the fund is one of the most active organizations involved in transferring money to Jewish communities across the Green Line. Between 2009 and 2013, the fund raised over $70 million in the U.S. and transferred almost all of it to Israel and the West Bank. According to its annual report filed to the Internal Revenue Service, in 2014, the fund's revenues increased to $25 million, and out of these almost $23 million were transferred to Israel.

U.S. laws don't require the fund to specify the destination of the money, and Marcus refuses to say what percentage of the fund's donations ends up across the Green Line. It’s a non-issue, he says, since the money doesn’t serve political purposes, limited as it is by U.S. Internal Revenue Service regulations governing non-profits. Providing security training to settlers, building a clinic in the settlement of Efrat or buying bulletproof vests for settlers is not political, he insists.

What about their support for Honenu, an organization that raises money for Jews on trial or in prison, in many cases for attacking Palestinians, and occasionally raises funds to support their families? “Honenu is a legal assistance group, not political. Just like the ACLU,” he says, referring to the American Civil Liberties Union.

Among the organizations that have received the fund's dollars is the Od Yosef Chai Yeshiva in the settlement of Yitzhar. The rabbis heading the yeshiva published a book that discussed the circumstances in which non-Jews can be killed.

IDF soldiers and Border Police officers install concertina wire on a fence surrounding Yitzhar's Od Yosef Chai yeshiva.Credit: Moti Milrod

The money the Central Fund of Israel sends to the yeshiva supports studies and nothing else, Marcus says. “After the story with the book I called them and checked what was it was all about,” he says.

But didn’t you want to stop giving them money and avoid the headache? “Yes”, he smiles, “but then I thought it would be wrong and Haaretz would feel they had won.”

The minimum donation the fund agrees to receive is $250, because the amount of paperwork doesn’t make it worthwhile to accept smaller sums, Marcus explains. Among the donors are Irving Moskowitz, a Miami-based physician who made a fortune building and managing hospitals and casinos, and businessman Roger Hertog, one of the former owners of the New York Sun. Both did not return requests for comment.

Asked why individuals or organizations should give money through the fund, Marcus says: "Some are not allowed to transfer money to non-U.S. organizations and some find it easier to let us deal with it."

“They know that everyone here is a volunteer and no money goes to salaries,” he says.

His mother, Hadassah Marcus, founded the Central Fund almost 30 years ago. Her goal, he says, was to avoid the problems she encountered transferring money to organizations in the West Bank via the Jewish National Fund and the high overheads of the organizations that do it directly.

“We would have never got a 501(c)(3) under this administration,” he says referring to the status of tax-exempt charity organizations in the United States. “Obama is anti-Semitic. He wouldn’t even condemn the kidnapping of those three kids [Jewish youths kidnapped and murdered by Palestinians in 2014.] He wouldn’t allow a synagogue to be built in Tel Aviv.”

Except for the period of the 2008 economic crisis, donations have grown steadily since Marcus took over the fund from his mother in the 1990s. He seems tired – and it’s not just the emotional stress of leaving his childhood home. “The phone just won’t stop ringing” with donation offers, he says, “from morning until night. I don’t get much sleep.”

The unplanned meeting with Jay Marcus took place last year, at the outset of the Haaretz investigation into the money trail between U.S. non-profits and Israeli settlements. Since then, Haaretz has contacted Marcus repeatedly, asking him by phone and email for further information about the Central Fund, its donors and its hundreds of beneficiaries. But, polite as he is, Marcus won’t say more about where the fund's money comes from – and where it ends up.

He was not in the office during another visit at the company's premises in September and there was no sign indicating the fund's presence at the entrance to the building. The guard, who has worked at the building for 20 years and says he knows Marcus well, claimed it was for security reasons. “I see a lot of donations, a lot of envelopes,” he said. “Sometimes people come here and quietly ask for the fund, but it’s not a known thing.”

Reporting for this story was supported by a grant from the Pulitzer Center on Crisis Reporting

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