Jewish-run children’s charity in N.Y. accused of fraud

(JTA) — New York state is suing to shut down a charity for children with leukemia run by a Brooklyn Jewish man accused of raising money fraudulently.

A petition filed in state Supreme Court in Brooklyn on Monday requested the closing of The National Children’s Leukemia Foundation, which was founded by Zvi Shor and run from his basement.

The foundation collected $9.7 million from 2009 to 2013, The New York Times reported, citing court documents. Some 80 percent of the money went to telemarketing and direct-mail fundraising campaigns, and only $57,451 was paid out in “direct cash assistance to leukemia patients,” the Times report said. The state’s attorney general is asking for the recovery of the money.

The foundation’s website has been taken down and its phone number disconnected, according to the Times.

Shor was president of the foundation until his resignation in 2010 following revelations that he had been convicted of bank fraud in 1999. The foundation’s accountant, Yehuda Gutwein, took over as president, though Shor continued to run things, according to the court filings.

Shor established the foundation in 1991 after losing a son to leukemia, the court filing said, according to the Times. He paid himself $595,000 in salary and $600,000 in deferred compensation from 2009 to 2013, and a lifetime pension of more than $100,000 a year.

The foundation fraudulently claimed to have a bone marrow registry and cancer research building in Israel. It also promoted a Make a Dream Come True program, arranging trips to places like Disney World for children with cancer, which apparently did not take place, investigators said in court filings.

According to the petition, the foundation also transferred $655,000 to an Israeli research organization.