Local rabbi could go to prison U.S. Attorney releases affidavit

Rabbi Bentzion Pil pleaded guilty last week in federal court to a felony charge of evading reporting laws on bank deposits. Outside the courtroom, however, the San Francisco rabbi still insists his actions were innocent.

And despite what his attorneys told the Jewish Bulletin two weeks ago, a plea agreement filed in U.S. District Court on Dec. 16 does include the possibility of at least 18 months of prison time for Pil — and up to 33 months if he does not take responsibility for his deeds.

"It's all in God's hands," Pil said Monday of his future.

Pil, the co-founder and director of the now-defunct Jewish Educational Center, said the only reason for making hundreds of bank deposits just under the $10,000 level that triggers federal reporting laws was to save time — not to hide anything.

He and other JEC employees did not want to stand in a "special line" at the Bank of America and fill out paperwork that would take "more than an hour," he said.

"This is what I'm guilty of — this one part," he added.

Michael Stepanian, one of Pil's attorneys, also asserted that Pil wasn't evading the reporting laws for "some nefarious purpose." Congress passed the laws to try to track down drug traffickers and other criminals.

Pil, who is 41 and the father of nine, added that he actually made only a "very small amount" of the deposits himself but that he wouldn't "blame another Jew" or "bring pain on another Jew."

"I take all the blame for everyone who made a deposit," Pil said.

The Chassidic rabbi said that when he was growing up in the Soviet Union and attending an underground yeshiva, he was taught to be prepared to undergo torture if the KGB discovered the yeshiva — and never to reveal the names of other Jews involved. The same applies here, he said.

"From the Chassidic point of view, it would be immoral" to turn in another Jew, he said.

Peter Magnini, a Bank of America spokesman, said Tuesday that customers depositing more than $10,000 are given a one-page currency transaction report to fill out, but they don't need to stand in a special line. And as far as the amount of time, Magnini said such a transaction doesn't take much longer than making a regular deposit.

In a related matter, an Internal Revenue Service affidavit filed in June 1997 as part of a search warrant against the JEC was made public for the first time last week, following Pil's admission of guilt.

The 50-page document includes details of an investigation that began in April 1996. In the affidavit, an agent in the IRS criminal investigation division details interviews with several former JEC employees and describes how the IRS secretly hauled off the JEC's garbage 23 times between November 1996 and May 1997 as part of the investigation.

The IRS filed the affidavit in order to get a search warrant in June 1997, when the city, state and federal investigations of the Pils and the JEC first became public.

Until then, the JEC was pulling in millions of dollars a year from auctions of donated used-cars.

Soon after the investigations became public, the JEC was found to be heavily in debt and was eventually declared bankrupt.

The city and the state have since settled their civil cases against the Pil and his wife, Mattie. The settlements restrict the Pils' ability to advertise and ban them from running public-benefit nonprofits until at least 2002.

Bentzion Pil's guilty plea in federal court last week is the only time he or his wife has ever admitted to any wrongdoing.

The charge covers 282 deposits made in 1995, totaling $1.7 million. "Many, many were just slightly under $10,000," Ross Nadel, the assistant U.S. attorney handling Pil's case, said in court.

The plea agreement includes several stipulations:

*Pil gives up his right to appeal.

*He must file all outstanding state and federal income tax returns.

*His wife will not be charged at all.

*A sentence of 18 to 24 months is recommended to the judge.

Nadel said the recommended sentence is based partly on whether Pil accepts responsibility for the deeds. Otherwise, the plea agreement calls for a sentence of 27 to 33 months.

"You have to sincerely demonstrate acceptance of responsibility," Nadel said the day after the court hearing.

Sentencing is set for May 4.

Regardless of the plea agreement, U.S. District Judge Martin Jenkins can give Pil a shorter or longer sentence than recommended — up to five years in prison and a $250,000 fine.

"I retain sole discretion," the judge told Pil in court.

Outside the courtroom, Stepanian said that "I must have misspoke" in regard to his statements two weeks ago about Pil not serving any prison time.

Stepanian added that he will file paperwork asking the judge not to send Pil to prison at all. "We are going to try to get probation," he said.

The IRS affidavit covers a wide range of subjects. Here are a few highlights:

*The JEC was billed for 5,916 radio ads between October 1994 and November 1996.

*The San Francisco Hilton bill for the January 1997 bar mitzvah of one of Pil's sons was $43,894.

*The "Kids Overcoming Katastrophe" campaign appears questionable. As part of it, the JEC brought over 12 boys from a large area around the Chernobyl nuclear disaster site. The JEC advertised for donated cars in order to help the boys get extensive medical treatment.

UCSF Medical Center had agreed to provide exams at a 50 percent discount. According to UCSF medical records, 10 of the boys were examined once. Four came back once more for a check on their lymph nodes. In all four, their "'lymphadenopathy' was resolved or improved."

*According to original copies of its radio ads, the JEC repeatedly promised car owners that their donations would help needy families who needed transportation.

Luis Barthel, who worked for JEC for 10 months, told the IRS "he never saw one legitimate donation of an automobile from the JEC to a needy person."

George Youngerman, the owner of Marin County-based advertising agency Tuna Productions, created many of the JEC's radio spots. He told the IRS that the Pils "wanted the advertising to say whatever it took to get people to donate, regardless of whether or not it was true."