Last February, a young Israeli businessman visiting New York got a phone call warning him to return to Israel right away.
The caller informed Tomer Shohat that he was no longer under the protection of Rabbi Yoshiyahu Yosef Pinto, according to court papers that Shohat has filed in New York State Supreme Court.
Pinto is an influential Israeli kabbalist with a worldwide network of political contacts. And Shohat was in New York to resolve a business dispute with Pinto’s top aide, Ben Zion Suky. Days after allegedly receiving the phone call, Shohat was arrested. In a lawsuit Shohat has filed against Suky, Pinto and others, he claims that the detective offered to let him go if he handed over his computer, which contained financial documents that Shohat alleges show financial misdeeds by Suky.
According to court documents filed by Shohat, he refused the detective’s demand. Police then charged him with stealing $15,000. But the Manhattan district attorney dropped the charges soon after.
The story is now at the center of two separate lawsuits in New York State Supreme Court in which Shohat has taken aim at Pinto, one of Israel’s most powerful rabbis, and at his senior aide, Suky.
In one suit, filed in early July, an investment group Shohat represents, U-Trend New York Investment LP, has accused Suky of raking in exorbitant fees from the building he and U-Trend control together. Suky has denied those charges.
In an earlier suit, filed by Shohat as an individual in February and amended in mid-July, Shohat personally accuses Pinto, Suky and others of causing the New York City detective to arrest him in order to keep him from discovering Suky’s alleged misappropriation of the building’s funds.
The detective, Eric Patino, denied the charges in a court filing. Neither Suky nor Pinto has responded in court to these allegations, though both have filed motions to dismiss the case.
The lawsuits represent the latest in a run of legal troubles for Pinto and his circle. Pinto, a Sephardic rabbi with Moroccan roots, wields deep influence throughout Israel’s political and business elite. When the Forward published an investigative report on Pinto in 2011, Israel’s consul general in Boston approached the newspaper on Pinto’s behalf.
Suky has been associated with Pinto for over a decade, and has been among his closest aides since at least 2010. The Forward reported in 2011 that Suky had a past as a porn distributor, and that his real estate ventures had faced a string of lawsuits. This year, Pinto has faced increased legal pressure in Israel. Israeli press outlets reported in February that prosecutors were preparing to indict the rabbi amid charges that he had attempted to bribe senior police officials. That indictment is still pending, and Israeli press reports say that attorneys for Pinto are negotiating with prosecutors. In May, The Jerusalem Post reported that prosecutors would ask for no more than a year in prison for Pinto under the terms of a proposed plea deal. In the meantime, Pinto is free to leave Israel, having posted bail worth roughly $6.5 million.
Meanwhile, Pinto’s offices in New York City, in the spacious former headquarters of a genealogical society just around the corner from Bloomingdale’s, remain an important center of his international empire. Yet trouble has followed Pinto to New York, too. According to The Real Deal, a New York real estate website, the firm that holds the mortgages on the East Side building began foreclosure proceedings in March.
The Shohat lawsuits center on another troubled New York City building, this one on Manhattan’s West Side: an extended-stay hotel called Metro Apartments. The building is partially owned by a Suky-controlled firm called 400 West 41 LLC, and by two Israeli groups — an investment firm called Aura, and U-Trend.
Metro Apartments is reported to be closely tied to Pinto’s operation and his Israeli legal troubles. According to a February report in the Israeli daily paper Haaretz, Suky swore out an affidavit in Israel in which he claimed that Pinto had approved giving free lodging at Metro Apartments to the senior police official accused of taking bribes from him. “Many people, including journalists, would stay for free at [Metro Apartments at Pinto’s] behest,” Haaretz reported.
Shohat’s group, U-Trend, appears to have been a largely silent partner in the property until 2012, when U-Trend’s founder, Naftali Mendelovich, killed himself.
Mendelovich was another Israeli guru, a finance educator who ran an outfit in Israel called Megamot College which taught investing skills. Mendelovich recruited investors from among his students at the school, who put hundreds of millions of shekels into a handful of investment schemes. Mendelovich’s suicide came after many of those schemes went bust.
According to the U-Trend suit, roughly 200 Israelis had invested a total of $12 million in the Manhattan real estate portion of the scheme, $10.5 million of which had been given as loans to help acquire the Metro Apartments building. After Mendelovich’s suicide, the U-Trend investors selected Shohat to help recover their assets. Their plan, initially, was to demand that the property hire an independent third party to replace Suky as manager. Suky and Shohat met in Ashdod, Israel, in April 2012 to discuss the demand, at a meeting hosted by Pinto.
According to the complaint in the U-Trend case, Pinto “persuaded [U-Trend] to abandon its request for an independent property manager.” In return, the property would start repaying millions of dollars in loans extended by U-Trend, and Suky would provide “greater transparency into the Property’s operations and his management of it.”
Shohat took Suky up on his offer of greater transparency. In late May 2012, he traveled to New York to begin investigating the situation at Metro Apartments. That investigation continued for months. Shohat claims in the U-Trend lawsuit that he found that Suky was overpaying himself, overpaying his brother and using the property’s accounts to pay personal expenses — all while allegedly mismanaging the property.
In a sworn affidavit in the U-Trend case, Shohat alleges that Suky paid himself $471,000 in management fees in 2013 and $442,000 in 2012. Prior to Mendelovich’s death, Suky’s take was far lower — just $299,000 in 2011. Shohat alleges in the affidavit that Suky took advantage of the lack of oversight following Mendelovich’s suicide and that he felt “free to raid [the property] with reckless abandon.”
Shohat claims in the same affidavit that a review by an outside consultant in 2012 found that the management fees paid by the hotel were “significantly higher than comparable hotels.”
Shohat also charges that Suky paid for his personal expenses out of the company’s accounts. In the U-Trend complaint, Shohat claims that these alleged payments include $1,500 to Bloomingdale’s in April 2012 for charges incurred by Suky’s wife; $2,500 the same month to cover the monthly common charges at a condominium unit owned jointly by Suky and Pinto’s wife; multiple payments for Suky’s flights to and from Israel, and $190 to the New York City Department of Finance in August 2012 to pay for a parking violation incurred by Suky’s wife.
Shohat also alleges that Suky had the property make a $4,800 contribution to U.S. Rep. Michael Grimm in June 2010. Grimm, who continues to serve in Congress after federal prosecutors indicted him in April, received half a million dollars from Pinto supporters in his 2010 campaign, according to The New York Times. Pinto supporters have since claimed that Grimm asked for donations in return for his help handling alleged threats by a former aide and a former follower. The federal indictment against Grimm does not mention those charges. The former aide, Ofer Biton, pleaded guilty to visa fraud charges in 2013.
Suky called Shohat’s charges “totally untrue” in a sworn affidavit filed in the U-Trend case. And Suky’s lawyer in the case, M. Teresa Daly, reaffirmed her client’s denial in an interview with the Forward. Suky “vehemently denies any charges of mismanagement,” Daly said. “Everything has been done reasonably.”
Following his investigation of the property, Shohat claims in the U-Trend suit that he went back to Suky and Pinto in late 2012 to demand, again, the appointment of a third-party manager to replace Suky. In his affidavit and complaint in the U-Trend case, Shohat describes lengthy subsequent negotiations with Suky and Pinto. Those negotiations allegedly broke down, and in February 2013, Shohat ordered that the building’s banker freeze Suky out of the building’s account.
“Within hours of the freezing of the bank accounts, I received a phone call from Rabbi Pinto’s brother advising me that I was no longer being ‘protected’ by the Rabbi and threatening that I should leave New York and return to Israel because I was at risk of harm and/or arrest if I remained in New York,” Shohat claims in his U-Trend affidavit. On February 21, Patino and other officers detained Shohat at Metro Apartments. In a footnote to his affidavit, Shohat claims that he had seen Patino with Suky and Pinto before, and that they had “described him as their friend.” Patino works both as a detective for the New York City Police Department, and as an agent with a commercial real estate brokerage called Azad Property Group, according to his LinkedIn profile.
In his July 17 amended complaint in his personal lawsuit, Shohat claims that Patino offered to have lunch with him instead of taking him to jail. Shohat refused and was taken to a police precinct. At the precinct, Shohat alleges that Patino asked him for his computer. Shohat refused, but Patino asked again after Shohat’s attorney had arrived at the precinct and left to meet him at the courthouse.
“Patino again advised [Shohat] that if he turned over the computer and all the information he had gathered regarding Pinto’s and Suky’s malfeasance, he would release him from jail,” Shohat claims in the complaint. When Shohat again refused, Patino filed a criminal complaint alleging that Shohat had committed grand larceny in the third degree. Months later, the Manhattan DA dropped the charges.
New York City’s corporation counsel, which defends police officers sued while on the job, denied the charges against the detective in an answer it filed to Shohat’s lawsuit.
Reached via telephone, the attorney for Suky and his brother in the personal case, Gilbert A. Lazarus, declined to comment. He has not yet filed an answer to the charges. Suky and his brother have filed a motion to dismiss the case, which is pending.
Pinto and his brother have also filed a motion to dismiss the case, and have not filed an answer to the charges. Their motion to dismiss, too, is pending. Their attorney, Randy Kornfeld, did not respond to a request for comment.
In one memorandum of law accompanying a motion to dismiss filed by Kornfeld, the Pinto attorney argues that the fact that Patino was accompanied by other officers when he arrested Shohat shows that he was not acting on Pinto’s orders.
The parties in the U-Trend case are currently negotiating a settlement.
Contact Josh Nathan-Kazis at firstname.lastname@example.org or on Twitter, @joshnathankazis
Josh Nathan-Kazis is a staff writer for the Forward. He covers charities and politics, and writes investigations and longform.