The kosher cartel: Was this Cleveland butchery a front for money-laundering and illicit vape trade?
At Tibor’s Kosher Meats, they chop the liver just so. That’s what has kept Shirley, an 84-year-old woman shopping there one recent day, coming back decade after decade.
The gleaming silver case always has what she wants, Shirley explained, and until recently, the man who often reached in and wrapped it up for her was the eponymous owner himself, Tibor Rosenberg.
“Is Tibor coming back?” asked Shirley, who spoke on the condition her last name not be used because the store has recently been the subject of scandal. She handed a fistful of bills to a clerk at the cash register, who grunted a curt “no.” Shirley packed her change into her purse and shook her head: “That’s too bad.”
When Rosenberg sold the store in 2019 to one of his employees, Ilan Senders, it was a major happening. Tibor’s is one of only two remaining kosher butchers in the tight-knit Jewish enclave of University Heights, and the Cleveland Jewish News ran a photograph of Senders, who was 21 and had worked at Tibor’s for two years, and Rosenberg, then 65, clasping hands in a hearty shake.
But federal prosecutors contend this was not a simple passing of the knife from one generation to the next. Though Ilan Senders was the public face of the sale, his brother Eyton, then 31, was listed as “co-owner and butcher” on bank papers. But according to a civil-forfeiture case filed March 10 in federal court, Eyton had never carved a side of meat, and instead used the shop as a money-laundering front for his drug-trafficking business.
Prosecutors allege that business, Dank Vapes and Dankwoods — which was implicated in a spate of vape-related hospitalizations and deaths in 2019 — manufactured and distributed at least 3.7 million vape cartridges infused with THC, the primary active ingredient in marijuana. Though marijuana use is legalized in some states, marijuana and THC distillates are still considered illegal substances under federal law. The Centers for Disease Control and Prevention found in late 2019 that Dank Vapes was the brand most commonly reported by some 2,000 patients with serious or fatal lung illnesses nationwide that year.
An attorney for Eyton Senders acknowledged in court papers last week that his client is a target in a federal criminal investigation, though no charges have been filed against him, his brother, or anyone else connected to Dank Vapes or Tibor’s. The lawyer, Ned Searby, declined to be interviewed for this story.
A message left for Ilan and Eyton Senders at the store was not returned, and attempts to reach Eyton at addresses and phone numbers listed for him in Los Angeles and Cleveland were unsuccessful. Tibor Rosenberg declined to discuss the case, but said in a brief interview that he had not worked at the store since October.
Prosecutors say in court documents that the “ill-gotten gains” from the sale of Dank Vapes cartridges were laundered through a network of bank accounts, LLCs, real-estate acquisitions, a cryptocurrency hedge fund and one Cleveland-area business — Tibor’s Kosher Meats.
Agents from the Food and Drug Administration’s Office of Criminal Investigations raided Tibor’s and several houses owned by relatives of Senders in Cleveland’s suburbs in September, after seizing a website used by Dank Vapes earlier that year. In one house in Beachwood, Ohio, they found marijuana, scales, grinders, THC vape cartridges, records for Tibor’s and almost $40,000 in cash, according to court records. In another house in University Heights, they found $2.1 million in cash stashed in a pair of attic safes.
In a March forfeiture filing, first reported by the Jewish News, prosecutors sought to seize what they say are more of the glitzy proceeds of the Dank Vapes enterprise: four luxury watches, a gold bar, a 2019 Nautique G25 boat and a black 1996 Porsche 911 Turbo. They are also after seven properties owned by LLCs and relatives of Senders, including two million-dollar homes in West Hollywood and an opulent $1.1 million mansion a 20-minute drive from Tibor’s, complete with a large gym and a Godfather-style wood-paneled office.
It is unclear how Senders might explain these assets because the federal judge in the civil-forfeiture case, Christopher Boyko, has allowed him and several LLCs he controls to file their responses to the claims under seal.
Like Senders’ lawyer, a spokesman for the U.S. Attorney’s Office for the Northern District of Ohio declined to comment. An attorney for Justen Balay, who federal prosecutors accused in the forfeiture filing of being associated with Senders and Dank Vapes, said he would be filing an answer in the civil-forfeiture case soon, but declined to comment further.
The allegations have sent shockwaves through Cleveland’s community of kosher-keeping Jews, where the little store has been a pillar of the community for generations.
“There’s a familiarity, a kind of menschiness, that people have with them,” said Richard Perloff, a Cleveland State University professor and local newspaper columnist who has written about Tibor’s and the culture of kosher butcheries in Cleveland. “I think people felt a little shorn of that umbilical cord when this thing with Tibor’s happened. It’s like a symbolic attack on your past, and your Jewishness a little bit.”
A ‘fake company’ in ‘a quasi-regulated market’
The CDC has connected Dank Vapes to a nationwide rash of lung illnesses among e-cigarette and vape users that, by February, 2020, had hospitalized or killed 2,807 people. CDC researchers found a strong link between the illnesses and vitamin E acetate, an additive used in some cartridges; though harmless when ingested in food or used in skin cream, vitamin E can cling to the lungs if aerosolized and inhaled.
Though many of the patients told CDC researchers they used multiple vape brands, the most common was Dank Vapes: 56% of patients in all 50 states cited their products. Public-health officials described these as black-market cartridges infused to the hilt with THC and packaged to look like ones made by reputable manufacturers in states where marijuana use is legal. Available in sweet flavors like mango and Apple Jacks, Dank Vapes cartridges came in black boxes bearing eye-catching illustrations and a logo font like something on a sign outside a Miami nightclub.
“Dank Vapes is a broad class of products from a fake company that use that term, which fit the legal classification of counterfeit,” said Brian King, deputy director for research translation for the CDC’s Office on Smoking and Health.
Most patients had acquired the cartridges, which were priced cheaply, from street-level dealers, friends or the Internet, according to CDC researchers. In January, 2020, reporters for NBC News found similar cartridges at an illegal underground marijuana bazaar in Los Angeles, and counted more than 49,000 posts about Dank Vapes on Instagram, including some made by dealers willing to sell them for Bitcoin. At one point, Dank Vapes packaging was even available for purchase on Amazon.
Timothy Mackey, an associate professor at U.C. San Diego who studies global counterfeit drug-supply chains, said that the FDA has struggled to keep pace with the relatively new and burgeoning vaping industry.
“The regulation’s been pretty slow,” added Mackey, who is also CEO of S-3 Research, which has received $100,000 from the National Institutes of Health to track drug dealers online. “What that provides is an opportunity for companies like Dank Vapes, which is not the only company in this space, to basically market and manufacture their own unregulated products.”
While Dank Vapes may have looked like any other vape product, the cartridges were much more dangerous. Tests by private labs found that some Dank Vapes cartridges contained pesticides and created smoke containing formaldehyde. When CDC researchers analyzed Dank Vapes cartridges collected from patients and seized during a raid in Minnesota, a stash estimated to be worth $3.8 million, they all contained vitamin E acetate.
“I’ve had some gastric-distress and my eyes have been twitching like crazy,” one anguished Dank Vapes user posted on Reddit in August 2019. “Has anyone else found out that they were accidentally (possibly) poisoning themselves?”
A legal maneuver with a lower burden of proof
In the civil-forfeiture filings, prosecutors have traced transactions between bank accounts linked to Eyton Senders and Chinese companies that make vape-manufacturing equipment. Mackey, who has also consulted with the Department of Justice on drug-diversion cases, said that because production and marketing are often separated by oceans in the counterfeit-drug trade, “it might be a hard case to prosecute.”
“It may have been a bad batch, a bad manufacturer,” he pointed out. “So if I were these defendants, I would say, ‘Hey, I just bought from this Chinese company. We were just trying to make money like everybody else, and it was a quasi-regulated market.’”
Though the raids and Senders’ lawyer have indicated a criminal investigation is underway, the accusations so far have been leveled only through a civil-forfeiture case, a legal maneuver that allows law-enforcement authorities to seize a person’s assets, sometimes without charging them with a crime. The practice has been criticized by liberals and libertarians as being ripe for abuse, but is still commonly used in drug cases. According to a report by the Institute for Justice, the Department of Justice seized more than $30.8 billion from 2000 to 2019.
“The government has a much lower burden of proof, and it’s going to be much more difficult for the people who own this property to try to vindicate their rights,” said Jonathan Witmer-Rich, a law professor at Cleveland State University and a former federal public defender. “However, if I were the target of this, I would not want to be indicted by the federal government in a criminal case. If they’re only taking my assets, that’s a better outcome than putting me in jail.”
This is not Senders’ first touch with civil forfeiture. In 2012, he was stopped by sheriff’s deputies on a Missouri freeway, who found $88,000 in cash in the trunk of his rental car, with the help of a drug-sniffing dog. Senders confessed to transporting marijuana from California to Ohio and making a return trip with the cash, explaining: “I’m the money guy.” Federal prosecutors seized $38,000. Senders was not charged.
Kosher butcher was ‘a place to legitimize his ill-gotten gains’
The Senders brothers’ purchase of Tibor’s, prosecutors have alleged, was part of a larger scheme to legitimize proceeds from Dank Vapes. That scheme is said to include buying houses and land in West Hollywood and the Cleveland suburbs. Prosecutors have also traced payments by family members and business associates of Eyton Senders to and from bank accounts associated with Sean and Shane Hvizdzak, brothers from Bradford, Pennsylvania, who ran a cryptocurrency hedge fund.
The Hvizdzaks raised $31 million in 2019 and 2020 from investors, one of whom they told that their fund was achieving returns as high as 134%. But the U.S. Securities and Exchange Commission says those profits were a facade, and the Hvizdzaks are facing fraud charges in federal court.
More than $26 million of investor money was misappropriated, according to the SEC, and at least $24 million of it is missing.
Tibor’s was purchased by Sendies Boys Limited LLC in September 2019. Documents kept on file with the Ohio Secretary of State show the trade name “Tibor’s Kosher Meats” was transferred to Sendies Boys by Rosenberg on Sept. 12, 2019, shortly after the sale was publicly announced in the Cleveland Jewish News.
No sale price was given. But according to federal prosecutors, the deal was at least partially financed with proceeds from Dank Vapes.
A man federal authorities have accused of being an associate of Senders and a money launderer wrote a $100,000 check to the Sendies Boys’ checking account on Sept. 9, the same day the deal was announced. After the sale, prosecutors have alleged, illicit funds from Dank Vapes were funneled through the store.
“This business, similar to other entities described in this affidavit, allows Senders a place to legitimize his ill-gotten gains,” wrote Assistant U.S. Attorney Henry DeBaggis.
House-made hot dogs and generous helpings
The shop now called Tibor’s Kosher Meats dates back to the 1930s or 1940s, when a store known as Osher’s was opened in the Cleveland suburb of Shaker Heights, serving its growing community of Orthodox Jews.
That store was taken over in the 1950s by Michael Altman, a Czechoslovakian emigre who narrowly escaped the Nazi occupation; his mother and four of his siblings were killed. At the time, Altman later estimated, there were at least 50 kosher butchers in Cleveland and its suburbs.
But by the 1980s, that number had dwindled to fewer than 10. Altman had moved his store to University Heights, following the Orthodox community as it migrated farther east. Altman’s children weren’t interested in staying in the family business, so in 1986 he sold the store to Rosenberg, a fellow Czechoslovakian who had first started working there in 1976.
“He was a good businessman, good worker and he had a vision how to do things,” Rosenberg said of Altman in 2019, after Altman’s death. “It’s because of him we have the store that we have.”
Rosenberg renamed the store Tibor’s Glatt Kosher Meats and ran it in the Altman tradition: unwavering commitment to kosher rules, generous helpings and first-name-basis service. Even as the number of local kosher butchers dwindled over the years to just a pair, Rosenberg kept the store alive by adding his own twists on old favorites –, like hot dogs made in-house, incomparable beef jerky and turkeys stuffed, indulgently, with pastrami.
In addition to a lively storefront business, the store provided meat to local Jewish nursing homes and synagogues, said Rosenberg’s wife, Irene, who worked as its bookkeeper. The shop was so prominent in community life that the Maltz Museum of Jewish Heritage’s collection includes a photograph of the staff.
“You’ll see Mr. Altman in the picture, Tibor and I, and some of the employees,” Irene noted.
Rosenberg’s daughters did not want to take over the business, so he sold it to Ilan Senders, who had played basketball for the Orthodox day school nearby, and had butchery in his bones. It felt not unlike when Altman had passed to torch to Rosenberg decades before.
“Grandpy would be so proud of you following in his footsteps and continuing in the family tradition — both grandpy and his father were butchers,” Ilan’s grandmother wrote in a congratulatory letter to the Jewish News after the story about the sale. “Your entire Cleveland family wishes you a big mozel tov. Ilan, stay the mensch that you are.”
Boris Mikhil, who owns Cleveland’s other kosher butchery, Boris’ Kosher Meats, and is such close friends with Tibor Rosenberg that they sit next to each other at synagogue, said Ilan used to frequent Tibor’s as a boy.
“He used to put the dishes in the sink, since he was too little,” said Mikhil. “And he would wash the dishes.”
But Mikhil said he hasn’t spoken with Ilan recently, and had no opinion on the prosecutors’ allegations. “I stay out of politics,” he said.
The new owners did not change the store’s name, Tibor’s, on the sign out front, and Rosenberg is still listed as an employee on the store’s website. But Rosenberg and his wife, Irene, in a brief interview, said he had not worked there for six months.
Locals have fierce loyalties to either Tibor’s or Boris’s, and some said they were not about to abandon a business their families helped keep alive for generations. They also were reluctant to speak publicly about a case that has not yet resulted in criminal charges. In interviews with three customers, only one, an Orthodox rabbi, said he planned to stop shopping at Tibor’s.
“As a lawyer, I believe everyone should have their day in court,” said another customer, who spoke on the condition of anonymity because he plans to keep shopping at Tibor’s regularly. He said he had driven his grandmother to the store back before it became Altman’s, and has “been dealing with them for 60 years, through various owners.”
Shirley, the 84-year-old woman who loves Tibor’s liver, was stunned by the allegations against the owners. But she has no plans to start frequenting Boris’s. She keeps coming back the same store members of her family have relied on for 50 years.
“It’s very sad, what they did to Tibor,” she said as she stood in the parking lot, bag of meat in hand. “I can’t believe it.”