WJC Conflict Seen As Intensifying

Two months after apparently squelching an insurrection, the leadership of the World Jewish Congress is facing renewed calls in its ranks for an independent audit and increased accountability.
Isi Leibler, a senior vice president of the organization whose public appeals for improved governance and transparency regarding WJC financial dealings prompted his dismissal in September, has refused to step down, and he seems to have found allies among the leadership of the Swiss branch of the WJC.
Alfred Donath, a professor of nuclear medicine who is president of the Swiss Federation of Jewish Communities, told The Jewish Week that he had first asked for an “independent audit” in April and renewed the request last month when he met with the WJC’s new transition director, Stephen Herbits.
As evidence of the political and personal pressures exerted in the matter, the European Jewish Congress, an arm of the WJC, threatened to expel Donath unless he dropped his call for the financial review. (The WJC provides major funding for its various branches around the world; the EJC receives $700,000 annually.)
In addition, Donath said in an interview that he was told by Israel Singer, the chairman of the WJC governing board, that he and his family would be “destroyed” if he did not give up his pursuit of an audit. Singer denied the charge.
At immediate issue is the transfer last year of $1.2 million among various WJC bank accounts, from New York to Geneva to London and back to New York. Donath said he wanted to know why the money was moved, who authorized it and why.
The funds came from the Jewish Agency for Israel and were being used to provide for a pension for Singer, the WJC’s longtime top professional.
Herbits insisted that the transfer was looked into thoroughly, that there were no “fiscal irregularities,” and that the accusations were part of an attempt by Leibler to embarrass Edgar Bronfman, his political rival who has been president of the WJC since 1981.
Leibler, a former leader of the Australian Jewish community who has lived in Israel for several years, denied the charge and said his only motive was to ensure the proper functioning of the WJC, an international organization combating anti-Semitism. It is best known in recent years for assuring restitution for Holocaust survivors, securing hundreds of millions of dollars in repayment from Swiss banks.
Herbits was in Europe last week and met with WJC leaders there in an effort to end the turmoil. He said an audit of the controversial transfer was done by Loeb & Troper of Manhattan, which provides auditing and consulting services to the health-care and not-for-profit sectors. The audit focused on the movement of the $1.2 million.
Herbits emphasized that the audit found that no money was missing and that the $1.2 million was returned to New York.
Donath was unimpressed, saying those facts were never in question. He maintained that the audit was unsatisfactory, though he declined to speculate on why he believed the money had been moved around.
“We do not consider it an independent audit because [the auditors] worked with the WJC for more than 20 years,” the Swiss leader said.
Herbits suggested that the controversy over the Swiss account stems from a decision to close the WJC office in Geneva and terminate its employees, a move the Swiss Jewish Federation opposed. Herbits said that decision has been changed and the Geneva office will hire new staff.
“It’s a non-story,” he said, though several Swiss newspapers have written extensively about the dispute.
Leibler sent an open letter to the executive members of the European Jewish Congress last week urging them to “pursue justice” and chastising them for “allowing yourselves to be used as a vehicle to deny a genuine investigation to determine the truth concerning serious allegations” directed against Singer and Bronfman.
The European group sided with the WJC leaders in calling for Leibler’s ouster and expressing satisfaction with the audit.
Leibler told The Jewish Week that “even Richard Nixon submitted to an outside investigation of Watergate,” while the WJC leaders used their own audit firm to look into his charges. He noted also that Herbits, described by Bronfman as his “right-hand man” at Seagrams, the Bronfman family company, is less than objective about the matter.
Herbits, whose professional record includes stints as adviser to three U.S. Defense Department heads, has insisted that his work will speak for his integrity.
Leibler’s letter to the European leaders questioned when executive members last reviewed “a WJC balance sheet” and “who determines expenses, salaries, termination, pay, etc.” His contention is that all major WJC decisions are made by Singer, with Bronfman’s approval, even though most of the organization’s annual budget of up to $8 million comes from about 400,000 donors, most of them in North America, in response to direct mail solicitations.
“I need not remind you that the supervision and application of public funds are sacrosanct,” he wrote, adding that everyone connected to the WJC who has challenged the leadership has been “dismissed, marginalized or demonized.”
In addition to Singer’s dismissal from his volunteer post in September, the executive vice president of the WJC, Elan Steinberg, parted ways with the group at that time. Avi Beker, an Israeli who headed the WJC as secretary general for two years, was given $1 million on his termination in 2003.
The lay leaders of the WJC have closed ranks against Leibler, though, describing him as a troublemaker and malcontent whose accusations have hurt the good reputation of the WJC.
Besides the Swiss objections to how the WJC has handled the affair, only the Australian Jewish community has sided with Leibler.
Jeremy Jones, president of the group representing Australian Jewry, wrote a letter to Herbits Nov. 11 questioning the independence of the recent audit and asking who determines how WJC funds are allocated, noting that his organization “does not believe it is in the best interests of the Jewish world or the WJC for questions that have been raised to remain substantially unanswered.”
Critics of Leibler dismissed the letter, suggesting that he still wields control over the organized Australian Jewish community he once led.
Leibler did receive outside support from Geoffrey Alderman, a columnist in the London Jewish Chronicle and former member of Parliament, who called on Singer and Bronfman to step down from their WJC posts until “the necessary investigations are carried out.”
As a result of the controversy, Bronfman announced in September that he had disbanded his plans to step down as president and will run again next year for an expected five-year term.

Stewart Ain is a staff writer; Gary Rosenblatt is editor and publisher.