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News Report on Illegal Outposts Prompts Calls for Probe of WZO

American Jewish communal leaders are calling for an investigation into the activities of the World Zionist Organization, a Jerusalem-based confederation of Diaspora Zionist groups, following an Israeli news report alleging that the body was funneling money to illegal settlement outposts.

The Israeli daily Ha’aretz reported on December 26 that Israeli government ministries were using the WZO as a conduit for government funds used to pay for trailers and permanent structures built on hilltops in the West Bank without government authorization. WZO officials denied the Ha’aretz report, saying that the body’s settlement division, which they say is fully funded by the Israeli government, only supports activities beyond the Green Line that are legal.

According to the Ha’aretz report, government funding of illegal outposts was acknowledged last week by Israel’s deputy defense minister, Ze’ev Boim, in testimony to the Knesset’s state control committee. “What was not publicized from that meeting,” wrote veteran Ha’aretz political reporter Hannah Kim, was the itemization of the funding, including “the financing of the cost of caravans and even the erection of permanent structures by the Housing Ministry and the Jewish Agency.”

The reference to the Jewish Agency was corrected to read “World Zionist Organization” in the paper’s English version. Conflating the two institutions is commonplace in Israeli conversation and reportage.

“If it’s true, I think it’s horrendous,” said Seymour Reich, a former president of the American Zionist Movement, the WZO’s main American affiliate.

“It sounds like the Iran-Contra situation,” said Reich, who is also a former chairman of the Conference of Presidents of Major American Jewish Organizations. “It’s harmful to the image of the WZO, and particularly to American Zionists who are part of the WZO. It gives an image of an improper use of money and putting a roadblock in the road map.”

Other critics included Rabbi Eric Yoffie, president of the newly renamed Union for Reform Judaism, whose Arza/World Union offshoot is a member of the WZO; two top leaders of United Jewish Communities, Marvin Lender and Richard Wexler, and the head of another WZO affiliate, Charney Bromberg of Meretz USA. All of them noted that they did not know if the allegations are true.

The WZO, founded by Theodor Herzl in 1897 as a vehicle for creating a Jewish state, is a confederation of Zionist organizations around the world that support Israel financially and politically. Its offshoot, the Jewish Agency for Israel, with which it shares offices and executive officers, is a social-service agency largely funded with charitable dollars from American Jewish philanthropic federations, channeled through United Jewish Communities.

The WZO and the Jewish Agency operated as a single institution governed by the Zionist organizations until 1971, when they were separated in a complex agreement that created a separate Jewish Agency board dominated by philanthropy leaders. Under the agreement the agency’s land-settlement department was divided in two, with the Jewish Agency retaining control of rural development inside Israel proper and the WZO taking charge of settlement in the territories.

Ha’aretz’s Kim quoted the head of the WZO settlement division, Avraham Duvdevani, telling the Knesset panel that his “division transfers funds both for the development of the Negev and the development of the settlements,” referring to the territories.

However, Kim reported, the combined budget of the two settlement departments for 2003 was reported in the Knesset hearing to be about $30 million, of which only about $2.3 million went to rural development in the Negev. There was no indication of how much of the rest was believed to have reached illegal outposts.

Critics said the alleged illegal activity — by an organization theoretically controlled by American and other Diaspora Jews — is particularly egregious at a time when Israel has promised its closest ally, the United States, that it will comply with the urgent request to dismantle unauthorized outposts. News of the WZO’s alleged involvement in funding the outposts shocked and angered members of the world Zionist movement, who said it could create the appearance that American Zionists stand in opposition with their own government.

“I believe it’s an abuse of the Zionist ideals to be doing this,” said Yoffie, a onetime director of the Reform Zionist movement. “All Zionist organization parties that participate in the WZO are in some sense implicated. It discredits the WZO.”

Several executives of the Jewish federated system, which donates roughly $200 million yearly to the Jewish Agency, endeavored to distance North American federations from the WZO. They said that federation funds forwarded to Israel by the United Jewish Communities do not finance WZO activities and that the Jewish Agency has significantly reduced its own allocations to the WZO.

“There’s been a real separation,” said Peter Friedman, budget and planning director of the Jewish Federation/Jewish United Fund of Metropolitan Chicago. “I get the Jewish Agency budget and not the WZO budget.”

Wexler, UJC’s financial relations chairman, told the Forward that the relationship between the WZO and Jewish Agency should undergo “careful evaluation [and] examination.” Wexler, who also serves as chairman of the North American Council of the Jewish Agency, said the WZO’s ties to Israeli politics have complicated Jewish Agency appeals to American donors. Issues surrounding “political activities of the WZO get in the way of a rational discussion of the unmet needs,” he said.

About the Ha’aretz report, Wexler said, “If true, it would be a terrible thing.”

Lender, a longtime federation leader and former chairman of the United Jewish Appeal, said that the alleged illegal activity of the WZO could be harmful to the federation system because the boundaries between the two bodies “are anything but clear…. That’s enough reason for the WZO to stay away from this. They shouldn’t be raising any questions or doubts about where UJC money is going.”

Lender said American charitable dollars do reach the WZO, mainly to fund some educational programs.

“We have to respect the policy of our government here,” said Lender, who also chairs the executive committee of the Israel Policy Forum, a pro-peace group.

Bromberg, executive director of Meretz USA, lambasted the WZO and called its alleged illegal activity one example of “a general corruption of principle and oversight that exists throughout the Israeli body politic.”

Bromberg called for the immediate cessation of WZO funding to all settlements. He said the world Jewish community is in disagreement over the construction of settlements, and therefore activity beyond the Green Line prevents people who would otherwise support the WZO.

Although the UJC does not have any structural ties to the WZO, such ties are maintained by Keren Hayesod-United Israel Appeal, a similar Jewish fundraising body that operates in countries outside the United States. Funds allocated by the Jewish Agency for WZO programs are required to come from monies collected by Keren Hayesod outside the United States because of complications in American tax law and tacit agreements between federation leaders and the Internal Revenue Service.

Keren Hayesod’s world chairman, Harvey Wolfe, declined to comment. Shoel Silver, president of UIA-Federation of Canada, a Keren Hayesod constituent, distanced his organization from the WZO. “The UIA as a practice does not fund settlements directly, and it doesn’t fund the WZO,” he said.

The spokesman for the Jewish Agency and the WZO, Yarden Vatikay, dismissed the Ha’aretz report as a political maneuver by Israel’s left wing. He said that the WZO settlement division is not funded with Diaspora dollars but solely by Israel’s government ministries. “This department is not like the other [WZO] departments,” he said. “It’s a governmental body put under the umbrella of the WZO 37 years ago.”

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