November 10, 2010

By Mosi Secret with the contribution of Richard Perry

 

The authorities came early on Tuesday, entering the six-story apartment building on Brighton 12th Street in the heart of Brighton Beach, Brooklyn.

 They headed upstairs, stopping at the fourth-floor apartment where Tatyana and Abram Grinman lived. The Grinmans, especially Tatyana, were known in the building; neighbors said she had approached many of them, asking if they wanted to participate in a program that would give money to Holocaust victims.

 "She gave me papers to fill out because my mother and father lived in the ghetto," said Bella Freytor, who lives upstairs from the Grinmans. "She said I keep $1,000 and she keeps $3,000," her fee for handling the application.

 The Grinmans were among 17 people charged in an elaborate scheme to defraud a reparations fund for Holocaust victims, according to indictments unsealed on Tuesday by the United States attorney in Manhattan, Preet Bharara. Federal authorities said the scheme netted the suspects at least $42.5 million over 16 years. The Grinmans were accused of using copies of identification papers to prepare fraudulent applications to the fund, the Conference on Jewish Material Claims Against Germany.

 One of the payment programs, known as the Hardship Fund, pays reparations to Jews who became refugees when they fled the Nazis. It offers a one-time payment.

 Ms. Freytor said she received a check in the mail for about $4,000, cashed it, kept $1,000 and turned over the rest to Ms. Grinman. She said her husband also submitted an application and received money. She said Ms. Grinman approached many people in the building and participation was widespread.

 "Now I know she cheated," Ms. Freytor.

 Like nine other defendants in the case, the Grinmans were arrested at home on Tuesday morning. The 11 had their initial court appearances on Tuesday and were released on bond. Five other defendants were arrested earlier. One person indicted, Valentina Romashova, remains at large.

 Reached at home on Wednesday, Ms. Grinman refused to comment.

 The scheme used a number of ruses, according to prosecutors. In some instances, the applicants' actual experiences would be tailored to fit the requirements of the fund; in other instances, a person's real name and Social Security number would be submitted, but with a fabricated age and life story.

 It was not clear to Ms. Freytor how or even if her application or that of her husband's was doctored; she said they gave their information in good faith, received a check and paid Ms. Grinman for her services.

 Ms. Freytor's account of the kickback scheme jibes with details in the indictment. A confidential witness told F.B.I. agents that she provided copies of her Social Security card and passport to Ms. Grinman. The witness then "cashed the check, kept $1,000 and gave the remainder of the money to Tatyana Grinman," according to court papers.

 The defendants face 20-year prison sentences if convicted of the top counts. When Mr. Bharara was asked whether participants like Ms. Freytor would face charges, he said, "the investigation remains open."

 On Brighton Beach Boulevard on Wednesday, people bent with age used canes and walkers to move slowly past the fruit stands and shops, and chatted in Russian. Not everyone was as forthcoming as Ms. Freytor. Many denied having heard of the scheme or the arrests, though some did express outrage.

 "I was in the ghetto, and I have problems now because of these people," said Zlota Portnaya, who sat among several women on folding chairs in front of a Russian pharmacy.

 Pat Singer, who calls herself the "mother of the neighborhood," lives in the Grinmans' apartment building and also runs the Brighton Beach Neighborhood Association, where she helps people fill out forms for entitlement programs. She posted the names of the 17 defendants on the front window of her association's storefront.

 "People who really deserve the money will now be looked at cross-eyed because of these morons," she said. "We'll have to live this down for the next 100 years."

 Janet Veksler, who also works for the association, expressed shame that Russian Jews were accused of perpetrating the fraud. "I had a feeling this was my people," she said, recalling her reaction after hearing the news. "I was just mortified."

 
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