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It isn't the first time the 57-year-old Balkany has raised controversy. Balkany has been the source of hundreds of thousands of dollars in contributions to politicians across the country, campaign records show, and he hasn't hesitated to seek help from those he supported. After the rabbi raised more than $300,000 in the 1980s for former senator Bob Dole, The Washington Post reported, the senator pressured a federal agency to back a Balkany project they had previously rejected. And former mayor Rudy Giuliani, who received over $20,000 in contributions from Balkany, gave the rabbi a major voice in the city's allocation of federal day care vouchers in the 1990s. Balkany was later investigated after he acknowledged collecting fees from parents to help fill out applications for the vouchers, but no charges were filed.
The rabbi's clout with prison officials, however, while long the subject of rumors among ex-inmates and those who represent them, has been less well known.
Balkany said his advocacy for white-collar criminals has always been altruistic, aimed at helping Jewish prisoners obtain kosher food and assistance on religious holidays. Among those he said he has helped cope with their prison time are hotel queen Leona Helmsley and onetime electronics chain-store mogul "Crazy Eddie" Antar.
Joel Davis, a Maryland accountant who served a federal sentence for an arson-insurance scam, told the Voice that Balkany was helpful to him and other Jewish inmates at Fort Dix prison in the 1980s. "He would speak to a congressman and the congressman would speak to the Bureau of Prisons, that's how it worked," he said, adding Balkany even arranged for his appeals brief to be read by a federal judge.
"I always came on a fair case," Balkany told the Voice. "Whether it was prayer books or kosher food."
The federal order restraining his prison advocacy was even more unusual because it was sandwiched into an agreement between Balkany and United States Attorney David Kelley to defer prosecution on a wholly separate matter, involving charges that the rabbi misused $700,000 of a federal grant to help disabled children. Under the deal, Balkany must pay back $400,000 of the money this year and place a $300,000 lien against his school for the rest. He also agreed not to seek any more grants or loans from federal agencies. But while no mention was made of Balkany's dealings with the prisons bureau in the criminal complaint filed against him last summer, the agreement also compels him to steer clear of all federal prison officials.
The document's tough language appears aimed at covering all possible bases. It bars Balkany from contacting or lobbying any prison official concerning "any matter involving a federal inmate or any other person charged or convicted of a federal crime."
What's that all about?
"I don't know myself," Balkany said. "They said something about it and I said, 'No problem.' They were happy to see me disappear."
Officials in the Manhattan U.S. Attorney's office declined to elaborate, as did a spokesman for the prisons bureau. "I know that [Balkany] has been in contact with our staff in the past," said prisons spokesman Dan Dunn, "but beyond that I can't comment."
The roots of the prohibition, however, appear to lie in a criminal case in Manhattan federal court, first reported by the Daily News' Robert Gearty. That case involves a pair of Russian immigrants who have admitted they engaged in a bribery conspiracy to pay off a Borough Park rabbi who would, in turn, arrange for another imprisoned Russian to be transferred to a less restrictive prison camp facility.
The name of the rabbi has not been revealed in the case, but according to Alexander Zakharov, a 43-year-old ex-limousine driver who admitted serving as a go-between in the bribe effort, the money was supposed to go to Balkany.
"That is who I was supposed to see, at his yeshiva," Zakharov said in a phone interview last week.
Indeed, after his arrest by FBI agents in August 2001, Zakharov said he met twice with Balkany at the Borough Park girls' school. He did not say whether the meetings were recorded for the agents.
Both Zakharov and co-defendant Sam Kaplun, whose son Vadim won a prison transfer with Balkany's help, pled guilty last fall. At his plea hearing, Kaplun told the judge that his agreement was to collect $50,000 to arrange a transfer for an inmate imprisoned with his son. "I agreed to pass money to [the] rabbi," he testified, "and I did know that some money will go to the rabbi and a certain [amount] will be paidpassed on to an officer of the [Bureau of Prisons]."
Balkany dismissed the allegation, saying that both men made up the account to win leniency from prosecutors. But the rabbi acknowledged that he had helped Kaplun's imprisoned sonas a favor.
"They came to me, one of them said their son was in jail," said Balkany. "He asked could he be switched to a place where there is kosher food. I placed a call to the [prison] chaplain and we got him switched. Then he wanted some other help. I said, 'There is someone who worked for the Bureau of Prisons, now a lobbyist or consultant in Washington, and I can introduce you.' When the father got in trouble he thought he could say something about me, but it backfired. I didn't tell him to go bribe someone."
Pressed for the identity of the consultant, Balkany said he couldn't remember. He said that over the years he has "worked with maybe 20 consultants; everything was registered properly."
According to a criminal complaint filed by FBI agent Susan Ostrobinski, the feds were tipped to the bribery scheme by another Russian inmate serving time for bank fraud at the Federal Correctional Institute at Otisville, New York. The inmate, John Ocean, said that Vadim Kaplun, in prison for a penny-stock fraud, told him he had a hook with the Bureau of Prisons who could arrange transfers to the prison camp at Allenwood, Pennsylvania. Kaplun allegedly said he'd already worked out his own deal to get sent to Allenwood, where he would be able to enter a drug program that could shave months off his sentence.
At the FBI's urging, Ocean pretended to go along with the scheme, which called for him to have an emissary pay $50,000 to a person referred to as "Sasha," Zakharov's nickname. Part of the bribe was to be in the form of a $10,000 certified check to "an organization connected to the rabbi," the criminal complaint stated.
At one point, Zakharov told a Russian-speaking undercover cop posing as Ocean's friend that "the people he reported to" had managed to see Ocean's pre-sentence investigation report, a confidential document available only to defense attorneys, the courts, and prison and probation officials.
Balkany wasn't charged in the plot and he said he has been told he is not the subject of any investigation. Asked if he'd ever asked Helmsley or Antar for contributions to organizations in exchange for his assistance, Balkany initially denied it. But he said that after he arranged a brief prison release for Helmsley so that she could visit family mem-bers' graves before Yom Kippur, the real-estatebillionaire made a contribution to his school.
"Someone on her staff contacted me, I never contacted any of these people," said Balkany. The rabbi said Helmsley paid for a plaque in memory of her deceased son to be placed in his school. Why a plaque in a girls' school? "I don't know why, maybe she wanted me to feel she was grateful," he said.
A spokesman for Helmsley said she preferred not to discuss her time in prison.