After a dozen years, one of the most sordid fraud cases in Israel's history drew to a close Tuesday when the Jerusalem District Court convicted Israeli businessman Benno Zussman in the "Greek Patriarchate affair." The scandal featured a fabricated real estate deal between the Jewish National Fund and Jerusalem's Greek Patriarchate.
"The indictment," noted Judge Rafael Carmel, "refers to an extraordinarily sophisticated and sweeping act of fraud, and it indeed appears that this was an unfathomable episode, one in which reality seems stranger than fiction."
After the fraud was uncovered, Zussman fled to Romania, and he remained there while his associate in the affair, Yaakov Rabinovitch, was convicted and sentenced to six years in prison. Stiffening Rabinovitch's sentence and delivering the six-year penalty, the Supreme Court stated that the Patriarchate affair constituted "one of the largest and most cunning acts of fraud ever committed in the realm of land transaction in the State of Israel."
Zussman was extradited to Israel from Romania 18 months ago. In the 1970s, he worked in the Foreign Ministry, then took up work in the real estate business. Over the years, he cultivated ties with Jerusalem's Greek Patriarchate.
According to Tuesday's verdict, he exploited these ties to hatch a vast land transaction conspiracy with his confederate Rabinovitch. The two took advantage of the fact that the Greek Patriarchate has possession of a number of valuable real estate assets in Jerusalem and elsewhere in the country. Among other sites, the patriarch owns lands in central Jerusalem where the Rehavia neighborhood was built. The lease agreement for Rehavia signed between the JNF and the Patriarchate in the early 1950s will expire in roughly 40 years.
The two conspirators conjured the illusion that aging Patriarch Diodoros had an interest in working out a new deal concerning the Rehavia assets, along with lands around Jerusalem's old train station and also in Beit Shemesh. They proposed that the JNF pay $20 million in exchange for leasing rights to these properties for 99 years.
The grand scam
The conspirators' wile reached its peak in mid-April 2000, when the ailing patriarch received a delegation comprised of Zussman, Rabinovitch, attorney Jacob Weinroth and a JNF representative; the aim of the meeting was to secure the patriarch's signature for the deal. Yet Rabinovitch and Zussman claimed that the patriarch was too frail and unable to receive all members of the delegation. So Rabinovitch and Zussman entered a room, then came out, putatively with documents signed by the patriarch.
The Jerusalem District Court verdict concludes that the two conspirators showed the patriarch an entirely different document, one conveying best wishes for the Easter holiday. When they relayed the documents, Rabinovitch and Zussman received from Weinroth two envelopes bearing checks for $16 million. Zussman was supposed to bring this money to the patriarch, but he never did. Instead, he deposited $6 million in a Swiss bank account.
The two conspirators pulled off this stunt by insisting to other members of the delegation that the transaction must be executed with absolute discretion, lest pro-Palestinian elements within the Greek church derail the deal. Zussman, the Jerusalem District Court concluded, "was well aware of all that was happening; he was part of the team that carried out this cunning act of fraud, one which [the conspirators believed] would not be discovered for years."
Carmel noted that due to his ties with the patriarch, Zussman was the key player in the fraud. Zussman's attorney Zeev Gordon claimed Tuesday that he was "surprised by the conviction."
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