Edwin BlackEdwin Black is the New York Times best selling investigative author of "IBM and the Holocaust", and his just released book, "Nazi Nexus: America's Corporate Connections to Hitler's Holocaust" (Dialog Press). He can be reached at www.nazinexus.com.
Originally, some people said they wouldn’t mind if kosher butcher Sholom Rubashkin got life in prison and rot behind bars until he dies. Yesterday, June 22, 2010, their wish was fulfilled by U.S. District Chief Judge Linda Reade in a northern Iowa courtroom. Under the stiff sentence, Rubashkin rots in jail essentially until he dies, a 27 year sentence supplemented by five years of probation to the 51-year man—and then he pays $27 million in restitution. Judge Reade’s sentence exceeded even the government’s request of 25 years. Now many people are outraged at the harsh treatment being meted out to Rubashkin and ask in disbelief, “What's going on?”
Within hours of the sentencing memorandum, issued a day in advance by Judge Reade, legal scholars expressed shock thousands of Chassidim gathered in vituperative video-streamed protests in New York and Los Angeles, and a cadre of agitated appellate attorneys vowed to overrule the judge’s decision.
Who is Sholom Rubashkin and what really happened?
Rubashkin is the man at the center of the torrid scandal swirling around the massively-investigated Agriprocessors kosher slaughterhouse in Postville, Iowa. Last November, a federal jury found Rubashkin guilty of 86 federal charges including bank, mail and wire fraud, and money laundering, as well as failing to pay livestock providers in the 24-hour time period required by law. He was originally facing a tough Department of Justice sentencing prison recommendation that the Probation Department calculated, under the Federal Sentencing Guidelines, as life in prison. In the wake of open letters of criticism from legal scholars from Lewinsky prosecutor Ken Starr to Alan Dershowitz, the government recommendation was later amended to just 25 years—still considered by most to be realistically a life sentence.
Those who have always wanted Rubashkin locked away for the rest of his days list his crimes as numerous and odious. Charges by bloggers, Jewish media reporters, and prosecutors include a heinous track record of mistreating illegal alien workers; tolerating drug dealing and gun smuggling in the plant; money laundering; obstruction of justice; perjury; and the painful ritual slaughter of cattle, all in the process of creating arguably the most successful kosher meat business in America.
Those who call for leniency for Rubashkin have plausible answers, explanations, and denials for every accusation. Upon review, many of those accusations are unproven, unprosecuted, and some are merely rumors. His defenders claim he is a charitable man who did not personally benefit financially from his business mistakes. He went awry of the law, they say, for the sake of providing abundantly and readily available kosher beef to the Orthodox. In this, he was successful, serving not just the larger Jewish communities such as those in Brooklyn and Miami, but those located throughout the distant corners of the nation. More importantly, his defenders say, Rubashkin went awry of PETA, the meatpacking unions, overzealous federal prosecutors in Iowa, and certain social dynamics within the Jewish community. His advocates assert that he has been overcharged, over-prosecuted and is now being over-sentenced for some very ordinary transgressions that would land a similar defendant in jail for only a few years. Now, he is facing life imprisonment for financial crimes that have nothing to do with the illegal immigrant worker scandal that made headlines. In many ways, those financial crimes were caused by the government itself, apparently as the sole means by which federal sentencing guidelines could be dynamically goosed up.
It would be impossible to reinvestigate the details of this complex, years-long case. But this much is clear: Rubashkin and Agriprocessors have found themselves on the receiving end of extraordinary enforcement measures and prosecution that for many are hard to fathom.
Some of the details yield a stunning indictment of prosecutorial zeal. His attorney, Nathan Lewin, of the Washington D.C. firm of Lewin & Lewin, argues, “In the almost 50 years that I have been practicing federal criminal law—first as a prosecutor and then as a defense attorney—I have never heard of, or witnessed, as vindictive, excessive, and mean-spirited a criminal prosecution as the one conducted in the Northern District of Iowa against Mr. Rubashkin.”
Lewin goes on to accuse Iowa prosecutors of “false representation to the court,” in opposing pre-sentencing bail for the Rubashkin last Passover. Specifically, avers Lewin, prosecutors told the judge that after the May 2008 Agriprocessors raid, Rubashkin arranged to send a key employee, Ben Chaim, and his family, to Israel and take over their property in Iowa, this to obstruct justice and make a witness “disappear.” Evidence in the record shows that arrangements for Ben Chaim to return to Israel were finalized months before the May 2008 raid, and were, therefore, unconnected to the raid or any potential obstruction. Based on this falsity, Lewin argues, bail was denied to Rubashkin. Lewin called for a Department of Justice Criminal Division investigation of the Iowa prosecutors for misconduct, but ranking members of the Justice Department did not agree.
In an exclusive interview with this reporter, Rubashkin's wife, Leah, says, “My husband definitely made mistakes. He is now paying for those dearly. If the clock were turned back, I'm sure he would not do those mistakes. But his good intentions were never for personal gain, only done with the feeling they would help the business [Agriprocessors] survive” and in so doing help fulfill a religious mandate to provide kosher beef to the Orthodox community.
Ironically, Rubashkin was not tried for hiring or mistreating illegal aliens. Instead, he was charged with financial crimes, including violating the obscure 1921 Packers and Stockyards Act, section 409 of which requires payment to cattle suppliers within 24 hours. In many cases, Rubashkin paid his vendors several days late—a common occurrence in today’s economy. Yet in a detailed sentencing memorandum, the prosecution points to 31 cattle suppliers who were not paid within 24 hours—but all were indeed paid. Specifically, on page 25 of the sentencing memo, prosecutors assert, “The actual loss to each Packer's Act victim is attributable to the fact that they all lost the time value of their money while they were waiting for payment.” As an example, the government sentencing memo declares, “Waverly Sales, Inc. has quantified the amount of their actual loss to be $3,800.51. This is based upon the amount of interest Waverly paid on a mortgage loan it took out on its property in order to cover the cost of the cattle sold to Agriprocessors while it was waiting for payment through the Packer's trust.” As such, Rubashkin is to get a life sentence in part because his supplier lost interest waiting for full payment, which was actually made, but made days late. Indeed, this is the first criminal prosecution under the 90-year-old Packers and Stockyards Act any legal expert contacted could remember.
In a written explanation, assistant U.S. Attorney Peter Deegan, Jr. defended, “The fact that they [cattle suppliers] were ultimately paid is completely beside the point when the essence of the criminal offense is the failure to timely pay providers of livestock.” The emphasis on the word “timely” is Deegan's.
Prosecutors also discovered that Rubashkin inflated his original receivables to secure a bank loan; even though no losses were incurred, the exaggeration constituted federal bank fraud. Moreover, when Rubashkin routinely checked off a boilerplate box on the original application, he swore his firm was not involved in illegal activities. That statement was deemed false by virtue of the illegal aliens who were discovered working at the plant. The government has claimed that the bank lost $26 million when Agriprocessors defaulted on its loan. Such a high loss forces the federal sentencing guidelines up. The more money lost in a fraud, the more years the guidelines suggest. But further inquiry shows that the bank in question actually made $21 million in interest from Rubashkin’s loan since he paid down his $35 million line of credit—on time, every time, for years.
Agriprocessors, says Lewin, only went bankrupt after the government's massive raid, compounded by threats to prosecute prospective purchasers if they employed family members who offered to continue running the business, and an original indictment on 3 counts that was amended by six major superseding indictments. New indictments were filed every few weeks for about seven months until the seventh indictment recorded a staggering 163 counts. When the thriving business with a built-in captive kosher market was forced into bankruptcy, all sorts of viable multi-million-dollar purchase offers were rejected by the bank until the business failed completely. At that point, the bank indeed lost $26 million in what Lewin and other defenders see as an artificial, self-created loss that served to intensely escalate the sentencing guidelines.
Undocumented aliens are an untidy fact in American manufacturing, but prosecutions for similar illegal worker raids have garnered sentences of only a few years for their executives. For example, in 2007, the Michael Bianco Company, a New Bedford, Massachusetts leather goods manufacturer, was raided. Some 326 illegal workers were discovered. Owner Francesco Insolia, found guilty of deplorable working conditions, received, in January 2009, a sentence of a year and one day plus stiff fines.
About a month after the May 2008 Agriprocessors raid, a Houston rag exporter called Action Rags USA was raided, resulting in the arrest of 150 immigrants. Owner Mubarik Kahlon was sentenced to two years' probation and a $6,000 fine. The list of comparably light sentence cases goes on virtually without variation.
With such light-sentence precedents, prosecutors chose not to proceed on immigration violations but instead went after Rubashkin's paperwork violations of a bank loan which had previously been paid on time and in full. But even financial crime sentencing —excepting those of the Bernard Madoff class—has been shorter than Rubashkin’s. His sentence exceeds that of Jeffrey K. Skilling, the former chief executive of Enron convicted of some $80 million in losses and massive economic fallout to the city of Houston; Skilling received 24 years. L. Dennis Kozlowski, the former chief executive of Tyco convicted of a $150 million fraud, received a state court sentence of to 8 1/3 to 25 years. Indeed, Mark Turkcan, the president of First Bank Mortgage of St. Louis—the bank Rubashkin is charged with defrauding—himself plead guilty to misapplying $35 million in loans, resulting in a loss of approximately $25 million during a years-long fraud and cover-up; Turkcan was sentenced last year by a federal judge in Missouri to one year and one day in prison.
During the years of the Rubashkin prosecution, it seems many in the Jewish community have maintained a stance either of silence or stern condemnation. That very quiet abandonment may have tacitly greenlighted prosecutors that co-religionists would not speak up in face of excessive action. Here there are many subtle Jewish community undercurrents at play, some critics and defenders assert. Rubashkin is a Lubavitch Chassidic Jew, and a leading member of Chabad. Some Jews reportedly revile the group because some Chabad followers hail their deceased spiritual leader, Menachem Schneerson, as the “Jewish Messiah,” said a well-known Jewish activist in New York who asked not to be quoted by name.
Pinchos Lipschutz, publisher of the Orthodox Jewish publication Yated Ne'eman, known in the past for its disagreement with Chabad, has aggressively defended Rubashkin. He added, “Some liberal secular Jews look at the Orthodox like they are dirty. I think this was the secular Jews against the religious. Killing is never pretty and a slaughterhouse is not a pretty site.” Religious media did point out the inequities, but Lipschutz adds, “No one takes the religious Jewish media seriously. Our papers are not picked up like the secular Jewish media.” Lipschutz was referring to mainstream secular Jewish newspapers that have aggressively covered the Agriprocessors scandal and editorialized against Rubashkin, garnering most of the wider media attention.
Attorney Lewin has publically pointed his finger at an exhaustive series of investigative reports and highly critical articles on Agriprocessors that ran in The Forward, a prominent Jewish weekly. Prosecutors cited articles in the Forward, says Lewin, who once advised Rubashkin to sue the paper for libel. Lewin says that doing nothing only emboldened The Forward to ratchet up what he called “venomous attacks” against Rubashkin. These had an impact, Lewin argues.
In spite of appearances that Rubashkin has been abandoned, large numbers of Jewish organizations and individuals have written recently to the Justice Department, created “Justice for Rubashkin” Facebook pages, recorded online support videos, and signed petitions seeking sentencing moderation. These include the Simon Wiesenthal Institute, Pesach Lerner and Young Israel, as well as scores of individuals. Indeed, according to Lipschutz, who heads up a legal defense fund, “We get checks every day—hundreds of checks. So far, we have raised more than $400,000. Just last week, I received a check for $7,283.76 from a man who said ‘please don't give anyone my name.’”
Virtually all of the petitioners make clear that they do not excuse any wrong-doing or criminal action. Many of the letters express a sentiment similar to Simon Wiesenthal Institute's April 14, 2010 letter to the Department of Justice. Decrying “a grotesque and inordinate life sentence,” the Simon Wiesenthal Institute asked for “a fair and equitable sentence.” But what should that have been?
Rubashkin's attorneys have asked for no more than six years. Former federal judge Paul Cassell called the government's sentencing demand “irrational and unjust.” Cassell, who wrote a 70-page opinion on another inordinate sentence stated, “The six-year number is in the ballpark. Life is what you get for first degree murder. This is a longer sentence than for second degree murder or rape of child.”
Perhaps no critic of Rubashkin has been more vituperative than Scott Rosenberg, a former Chabad Jew in Minneapolis, who operates the blog known as FailedMessiah.com. This blog has covered every development in the case in depth, and is credited by some with “keeping the case alive.” Rosenberg is a former family friend of the Rubashkins who several times ate at their dinner table on Sabbath. Rosenberg called Rubashkin a “sociopath,” yet added, “I don’t hate him, I actually like him. I don’t want his wife and kids to suffer for 20 years, God forbid, while he sits in jail. But how to protect society?” Asked months ago what sentence he himself would assess if it were in his power, Rosenberg replied, “If I had the power, from my heart I would sentence him to 3 years at a medical facility and a long term of close supervision after that. From my head, I would say fifteen years.”
Leah Rubashkin said she has spoken to her husband and if he received a single digit sentence, upon release he would not return to the business world but to community outreach, and tending to his ten children, one of which is autistic.
Once the judge’s June 21 sentencing memo was released, defense team conference calls began flying. Republican former conservative-minded U.S. Attorney Bob Barr, appointed by President Ronald Reagan, caught in an Atlanta airport when the sentence was learned, bristled that Reade’s decision yielded the most excessive sentence he has seen in his entire legal career. Similar remarks have been consistently voiced by a range of former prosecutors, from Bill Clinton-era Attorney General Janet Reno to Clinton’s chief nemesis special prosecutor Ken Starr. Indeed, six former Attorney General representing the spectrum of political and sentencing philosophies have signed public letters rejecting the harsh sentence the government proposed and which was exceeded by the ultimate terms the judge handed down.
Even arch-critic Scott Rosenberg of failedmessiah.com thought a lighter sentence should have been meted out. "Judge Reade followed the federal sentencing guidelines,” stated Rosenberg in an email to this reporter. “The problem with the length of Rubashkin's sentence lies with those guidelines – and with the multitude of crimes Rubashkin committed and his refusal to demonstrate remorse or make restitution. That said, I wish Judge Reade had departed from those sentencing guidelines, and given Sholom a lighter sentence."
Ironically, the judge’s sentencing memorandum went so far as to warn Rubashkin not to appeal. Indeed, she included the remarkable statement that if she did make an appealable and reversible error, on re-sentencing she will only increase the punishment. On page 46 she writes, “Although an upward departure would be permitted under USSG §5K2.0(a)(3) and § 5K2.21, the court declines to depart upward . . . [I]n the event the court is required to re-sentence Defendant, it reserves the right to revisit these upward departure provisions to determine whether their application would be appropriate.” She expands the threat on page 50, writing, “Were the court to vary, the court would vary upward to take into account additional criminal conduct involving harboring of illegal aliens, which was charged in over seventy counts of the Seventh Superseding Indictment and were later dismissed.” She adds, “The court notes that, even if it inadvertently erred in computing the advisory Guidelines sentence, it would still impose a sentence of 324 months of imprisonment after considering the factors in § 3553(a).”
U.S. Attorney Stephanie Rose, whose office prosecuted the case, was asked a series of questions about the judge’s sentence and issued this reporter the following answers.
First: Did the massive media and letter writing campaign, play a role in the sentence? Rose’s office answered, speaking only for the prosecution, "As far as the actions of the government... it had no effect. We have always based our actions solely on the facts and on the law."
Second: Judge Reade sentenced Rubashkin to a term exceeding the government request. Why?” Rose’s office would only say, “The judge looked at the facts and circumstances and it was her judgment call on what the appropriate sentence was. That is the job of judges."
Third: Was the severity of the sentence in keeping with others convicted of financial crimes, including the year and a day issued to the president of the very bank Rubashkin was convicted of defrauding?” Rose’s office replied, “Any comment on that fraud [First Bank Mortgage of St. Louis] is meaningless without knowing all the facts. [These comments] don’t take into account in other white collar cases such as Bernie Madoff who received 150 years. And a fifty year term for Tom Petters (convicted of a multi-billion dollar Ponzi scheme), a 100-year sentence for Edward Okun (issued last year on a $126 million tax scheme).” Rose’s office added, “Sentences of more than 25 years were also issued for two executives National Century Financial Enterprises."
Fourth: Was justice served by Judge Reade’s sentence? Rose office would only respond, "It is not our call as to whether the sentence is appropriate or not. Justice was served by the prosecution and the court having the opportunity to look at all the facts and circumstances in arriving at sentence."
Attorney Lewin promised that Rubashkin would ultimately get a fair hearing, but not until his case was appealed to the Eighth Circuit Court. At press time, that appeal is being typed.
Edwin Black is the author of IBM and the Holocaust and previously investigated the life sentence given to Jonathan Pollard.