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Thursday, March 29, 2007

The WJC Financial Scandal

Everyone interested in Jewish affairs should be concerned about the financial irregularities of the WJC. Isi Leibler's long fight has been vindicated.  

Save the World Jewish Congress

by Isi Leibler
March 29, 2007

Almost three years have passed since I became aware of serious financial irregularities within the World Jewish Congress (WJC) and called for an independent audit.

My proposal was not merely rebuffed but together with those who supported my request, I was censured, demonized and ultimately forced out of the organization.

The cover-up was ruthless and brutal. I still remember the anonymous posters plastered throughout Jerusalem calling on Jews to place me in cherem (excommunication from the community).

But ultimately truth prevailed.

The damning report of the New York State Attorney-General, released January 31, 2006, should have ended the story. But no: an irrational rage overcame the WJC leaders who launched a vindictive $6 million libel suit against me. It backfired and they were obliged to withdraw and ordered by the court to pay my costs. Moreover, the failed libel suit created a worldwide furor and led to even more damning disclosures of previous improprieties, including millions of dollars of unreconciled funds from a WJC account in Switzerland as well as details of expense account extravaganzas that astounded even the sharpest critics.

The final chapter in this unhappy and demoralizing scandal was the recent decision by WJC president Edgar Bronfman to dispense with the services of his former secretary-general without prior consultation with his colleagues. Subsequent internal political intrigues challenging his judgment obliged Bronfman to publicly spell out some of the unedifying reasons justifying his decision. That reignited the media scandal-fest worldwide.

While I cannot deny satisfaction for being vindicated, I am genuinely distressed that the WJC which I have served for so many years has been besmirched and so fundamentally compromised that today its very future is in doubt. I wish to state categorically that my objective was never to harm the WJC but to insist on clear governance and financial transparency; to reform and democratize the organization. Had our appeal for an independent audit made three years ago been endorsed, this entire issue could have been resolved internally without the shameful flood of public scandal.

Ever since, the WJC has been in virtual freefall. It squandered millions of dollars in legal fees and other payments in the course of frenzied but futile efforts to cover up financial improprieties. As a result, its financial resources are close to exhaustion and its ability to raise future funds has been enormously damaged.

For three years, at a time when the Jewish people were being confronted with enormous problems and anti-Semitism had become a global plague, the WJC was utterly impotent, concentrating exclusively on defending itself from critics.

Worst of all, the cover-up backfired, generating a flow of scandal which deeply embarrassed Jews throughout the world and provided grist for the mills of anti-Semites and enemies of our people.

EVERY DIASPORA Jewish organization based on public funding must heed the important lessons to be learned from this tragic meltdown of a distinguished international Jewish organization.

The most important is the need for organizations to ensure that senior lay leaders and professionals must at all times remain accountable to a board or executive. When, either by default or design, senior officials begin operating beyond the framework of governance, corruption becomes ingrained.

The tragic downfall of the World Jewish Congress is truly encapsulated in Lord Acton's famous dictum "Power corrupts and absolute power corrupts absolutely."

Every executive officer must be aware of his personal responsibility for maintaining the propriety of the organization, especially in relation to financial affairs. When WJC leaders initially failed to condemn the improprieties of a single person out of deference to his perceived former contributions, they paved the way for the lies, cover-ups, and disasters which subsequently engulfed the organization.

The New York State Attorney-General has now imposed on the WJC a structure designed to provide checks and balances and ensure financial transparency. But to be meaningful, these structures must ensure that governance is applied in substance as well as in form. That requires genuine accountability, consultations and collective responsibility. Above all, it obliges leaders to be personally sensitive to democratic procedures. The days of a WJC being a one-man personal fiefdom are over.

There is also the need to adopt a dramatically different moral approach to the utilization of public funds. Mr. Bronfman has undoubtedly been an extraordinarily generous donor. But approximately 90% of WJC funds were contributed not by Bronfman, but by the American Jewish public. These funds must be recognized as sacrosanct and treated accordingly. That implies that expenses should not only be reasonable but must be transparent. A situation in which one official could exploit expenses as a vehicle for leading a profligate lifestyle must never recur. Salaries and expenses must be as transparent as they are in public companies and the public sector. Above all, donors have the right to know how their funds are being applied.

The World Jewish Congress is today on the verge of imploding. And alas, after the global media exposure of the scandals, the majority of Jews today would probably endorse the closedown of this once-venerable organization.

That would be tragic and would necessitate the creation of a new global body.

Whereas the powerful American Jewish community can stand alone, other Jewish communities need a body like the World Jewish Congress, not the least in Latin America and Europe.

A reformed WJC should encompass a broad spectrum of Jewish political and religious attitudes and provide an arena for international consultations and strategizing. It must be in the vanguard of the struggle against global anti-Semitism and develop alliances with other groups on a broad range of issues. It should also be at the forefront of the battle to buttress the legitimacy, welfare and future of the Jewish state. It must provide support for embattled and isolated Jewish communities.

How can the World Jewish Congress close the chapter on this unhappy affair and move forward with a dynamic and creative agenda? In the first instance the current leaders should call for elections and make way for a new team, untainted by the recent scandals. They can retire with dignity, taking pride in their successful role in the historic campaign for restitution and other notable achievements which will occupy a place of honor in Jewish history.

There is an urgent need to heal the divisions and concede that major mistakes were made in the past.

Apologies are called for. There must be a determination to move forward on the basis of genuine governance and display greater sensitivity to the concerns of the regional branches and constituents. That means that in future no major policy decisions should be made in the absence of prior consultations intended to achieve consensus.

This is the time for a rejuvenated World Jewish Congress in association with the leading American Jewish agencies to look to the future and confront the enormous challenges and perils facing our Jewish people.

The writer, a veteran international Jewish leader was formerly chairman of the governing board and senior vice president of the World Jewish Congress.

This article can also be read at

Copyright - Original materials copyright (c) by the authors. Originally posted at Please do link to these articles, quote from them and forward them by email to friends with this notice. Other uses require written permission of the author.


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