Sholom M. Rubashkin, son of Agriprocessors founder A. Aaron Rubashkin, was found guilty in November 2009 on 86 charges of financial fraud and money laundering. His counsel had requested that he be released on bail pending formal sentencing on those charges; however, a panel of three judges from the St. Louis-based Appellate Court denied the motion late last week. An exact sentencing date for Rubashkin has not yet been set, but is anticipated to take place this spring.

Counsel for Rubashkin can continue to appeal the decision.

On Monday, former plant operations manager Brent Beebe admitted in a plea arrangement with federal prosecutors that he brokered deals between Rubashkin and undocumented workers, effectively providing the workers with falsified documents for a cost. The transaction of more than $4,000, according to court records, took place one week before a massive May 2008 immigration raid at the Postville facility.

Beebe remains free on bond, pending sentencing.

Since the raid several members of management at the plant have been probed by federal authorities, and many have been convicted of wrongdoing. The plant itself was sold through bankruptcy and now operates under new leadership as AgriStar. Some former members of plant management, including Rubashkin’s brother, Heshy Rubashkin, continue to provide services to the new plant owners, although the exact extent of their involvement remains unclear.

Due to the trial process, several undocumented workers were detained in Postville as possible key witnesses. Wearing ankle GPS tracking devices, some hoped only for deportation while others began their own legal battles to establish residency in the U.S. Just days following Christmas, most of those detainees were brought to Cedar Rapids where their ankle tracking devices were removed by court officials.

The Rubashkin family and friends, who have rallied around Sholom throughout the process, have hired a New York-based communications firm to represent the interests of an established defense fund. The company has reached out to members of the press and has began a presence on social networking sites.

U.S. District Court Chief Judge Linda R. Reade has ordered that the Iowa meatpacking manager found guilty on 86 counts of fraud and money laundering will remain behind bars.

Sholom M. Rubashkin, who served as the day-to-day manager at Agriprocessors in Postville and is the son of company founder A. Aaron Rubashkin, will remain in the custody of U.S. Marshals until he is sentenced on the earlier conviction. It is unknown if Rubashkin, who recently had 72 immigration-related offenses against him dismissed, will remain in a county facility or will be moved to a federal prison. An exact sentencing date has not yet been established, and, since the process requires extensive reports for judicial review, the date could be several weeks from now.

In the bail hearing on Wednesday, the Rubashkin defense team pointed to the man’s strong community and family ties in Postville as well as his record of good behavior while on release pending trial. Prosecutors, on the other hand, told the court that the fact that Rubashkin was facing a sentence of possibly several hundred years in prison that the situation had changed significantly.

In addition, the prosecution called Mike Fischels, a special agent who has long been assigned to the Agriprocessors case, to testify about an overseas telephone conversation he had with a company supervisor still wanted by the government.

Fischels testified that he spoke with co-defendant Hosam Amara on the telephone about Amara’s flight from the U.S. to Israel. Amara indicated to Fischels that [Rubashkin] told him to leave the U.S. and return to Israel in order to remove himself from the situation facing Agriprocessors.

The government also presented a copy of a check and bank documents that suggest Rubashkin provided financial assistance to Amara around the time that he fled the U.S.

The court finds that the government’s evidence for detention is compelling.
Defendant’s actions prior to and during the pendency of the instant action, when coupled with the powerful incentive to flee due to the jury’s return of the Verdicts, demonstrates that Defendant poses a flight risk. The court notes that, in the Detention Order, it previously found that Defendant posed a flight risk.

The court acknowledges the overwhelming support that Defendant’s community has provided during the trial and the instant proceeding. The court also recognizes that Defendant took great pains to comply with the terms of his pretrial release. The court agrees that Defendant has shown he is committed to his family and to his community. Nevertheless, the court finds that this evidence does not rise to the “clear and convincing” level necessary to show that he is “not likely to flee [. . .] if released under [§] 3142(b) or(c).” 18 U.S.C. § 3143(a). Accordingly, the court shall grant the Motion.

Rubashkin’s defense team has pledged to appeal the fraud and money laundering convictions. It is unknown at this time, however, if they will also appeal this detention order.

Sholom M. Rubashkin

Rubashkin, who is the 50-year-old son of Agriprocessors founder and president A. Aaron Rubashkin, was convicted of all possible money laundering and mail, wire and bank fraud charges. He was also convicted on 15 out of 20 counts of failing to provide timely pay to livestock auctions and providers.

The verdict followed nearly a month of testimony and evidence in which the government sought to paint Rubashkin as one, if not the, mastermind in a plot to defraud creditors. The defense team, in contrast, chose to portray Rubashkin as inexperienced, naive and unprepared to serve as day-to-day manager for such a large undertaking as the kosher meatpacking plant in Postville.

Following the lengthy reading of the verdict, Rubashkin was taken into federal custody, and his defense attorney, Guy Cook, pledged to appeal. Rubashkin is expected to return to eastern Iowa next week for sentencing and a possible bail hearing pending appeal. He faces a maximum sentence of more than 1,000 years in prison for the guilty verdicts.

An early December trial has been slated for an additional 72 federal immigration-related charges against Rubashkin, and he also faces a trial in state court this spring for possible child labor law violations.

All of the charges stem back to a massive May 12, 2008 immigration raid at the Postville facility. More than 300 immigrant workers detained by federal authorities pleaded guilty to criminal charges related to identity theft within days of their apprehension, and the bulk have been deported after serving brief federal prison sentences. Some immigrant workers, however, continue to live in and around Postville and are expected to be called by the prosecution in the upcoming trial.

The road between the actual raid and the federal trial in Sioux Falls, S.D., was long and has often wound its way through traditionally uncomfortable conversations for Americans regarding immigration, civil rights, religious expression and the composition and worth of charity.

The Rubashkin family, all ultra-orthodox Jews affiliated with the Hasidic Chabad Lubavitch movement, have at times suggested that the charges against them stem not from any alleged illegal activity, but from anti-Semitism. Throughout the investigation, and especially following the initial arrest and jailing of Sholom Rubashkin, many of the Jewish religious faithful, either through their own conscience or through the prodding and help of Chabad, have defended the Rubashkins from wrongdoing and stood as character witnesses for the family’s contributions.

Both inside and outside of Jewish circles, however, the Rubashkins have drawn criticism, many believing that generosity was born of ill-gotten-gains, harvested on the back of an underpaid and often mistreated immigrant workforce. Media reports, which prompted the move of the trials from Iowa to South Dakota, have given supposed victims of child labor and sexual harassment at the Postville plant a voice.

The company known as Agriprocessors fell into bankruptcy last year, and has re-emerged as AgriStar under the new ownership of SHF Industries, a venture of Canadian businessman Hershey Friedman. Heshy Rubaskin, brother to Sholom and son of Aaron, continues to work at the reborn business.

At least six former members of plant management or the human resources department have pleaded guilty in the wake of the 2008 immigration raid:

April 13, 2009 — Elizabeth Billmeyer, 48 and the former human resources manager, pleaded guilty to one count of conspiracy to harbor undocumented aliens for profit and one count of knowingly accepting false resident alien cards.

March 19, 2009 — Penny Ann Hanson, 41 and a former human resources employee, pleaded guilty to conspiracy to make false statements on immigration documents.

Dec. 10, 2008 — Karina Pilar Freund, 29 and a former human resources employee, pleaded guilty to one misdemeanor count of aiding and abetting a pattern or practice of hiring undocumented aliens.

Oct. 29, 2008 — Laura Althouse, 38 and a former human resources employee, pleaded guilty to one count of conspiracy to harbor undocumented aliens and one count of aggravated identity theft.

Aug. 27, 2008 — Martin De La Rosa-Loera, 43 and a former plant supervisor, pleaded guilty to one count of aiding and abetting the harboring of undocumented aliens.

Aug. 20, 2008 — Juan Carlos Guerrero-Espinoza, 35 and a former plant supervisor, pleaded guilty to one count of conspiracy to hire illegal aliens and one count of aiding and abetting the hiring of illegal aliens.

Former plant operations manager Brent Beebe, 51, will soon be tried on immigration-related charges in federal court. Two additional plant managers — Hosam Amara and Zeev Levi — also face criminal charges, but have yet to be apprehended by authorities.

Rubashkin, the former day-to-day executive at the Agriprocessors meatpacking plant in Postville, recently had his federal trial moved from Iowa to Sioux Falls, S.D. in an effort to mitigate jury tainting due to excessive media coverage. He faces a host of immigration-related and fraud charges that stem from a May 2008 immigration raid at the Agriprocessors plant. On Thursday, a half-page advertisement ran on page 5 of The Des Moines Register that was paid for by “Friends of Sholom Rubashkin” using a Brooklyn, N.Y., address. It was a move which caught the ire of federal prosecutors as well as the judge who agreed to move the trial from Iowa to South Dakota to mitigate pre-trial publicity.

A half-page ad that ran Thursday in The Des Moines Register, linked to members of the Rubashkin family, has not appeared in Sioux Falls media where the trial of Sholom Rubashkin is scheduled to begin this month.

Chief Judge Linda R. Reade, according to The Gazette, said that if such an advertisement ran in the similarly Gannett-owned Sioux Falls newspaper, that she was “going to hit the roof.”

Guy Cook, defense attorney for Rubashkin, told the court that he was not aware of the advertisement and that it didn’t stem from the council of rabbis who are providing defense funding for his client. The address used in the advertisement, however, is also used by Rite Surgical Supplies, a company that has ties to the Rubashkin family. Levi Balkany, a grandson of Agriprocessors founder A. Aaron Rubashkin and nephew of Sholom M. Rubashkin, listed himself as vice president of Rite Surgical Supplies on forms required by the Federal Elections Commission by those who make political contributions.

Levi Balkany is the son of one of Aaron Rubashkin’s daughters and Milton Balkany, a Rabbi who was charged in 2003 with misappropriation of nearly $1 million in federal grant money intended for disabled students at a Jewish school. After Milton Balkany apologized and made restitution, he did not face prosecution. Milton Balkany has also been referred to as the “Brooklyn bundler” for his ability to gather and bundle numerous campaign donations (many from Rubashkin family members) for primarily Republican candidates, in exchange for consideration of issues important for Orthodox Jewish institutions. Part of the federal deal for deferring prosecution on the grant money was that Balkany would be barred from lobbying the U.S. Bureau of Prisons, although federal prosecutors declined to elaborate on why this particular activity was of importance.

Levi Balkany is one of 16 individuals, members of the Chabad Jewish Community in Brooklyn, that were named in December 2008 to “The Committee of Concerned Anash for Pidyon Shevuyim,” a group organized to create a top-notch legal team for Sholom Rubashkin and to mount a donation and public relations campaign on his behalf.

In a press release the committee said that they want “the public to know they are the official group to assist and aid the Rubashkins, endorsed by the family” and that they have “years of experience in dealing with pidyon shevuyim (prisoner of war) cases.”

Although the committee’s efforts have been prominent in Jewish circles, the half-page ad in Iowa is one of the few times the group has sought to sway overall public sentiment regarding the case. Weekday reach of The Des Moines Register into the Sioux Falls area is roughly 3,500 households, according to a company spokesperson.

Judge Reade, citing media accounts that prohibited seating an impartial jury in the case, decided in August to move the upcoming trial from Iowa to South Dakota. At that time, the court warned prosecutors and defense attorneys about tainting the Sioux Falls media prior to the start of the trial, which is scheduled for Oct. 10.

Defense attorneys during a pretrial hearing in Cedar Rapids on Thursday argued that prosecutors had already dismissed the court’s warning by sending out press releases announcing the guilty plea of Mitchel Meltzer, a former chief financial officer at the plant, to numerous press outlets, including those in Sioux Falls. Despite the press releases not being targeted to that specific media market, Judge Reade nonetheless admonished the prosecuting team.

Reporters covering the case in Sioux Falls, according to Reade, will not be allowed any access to immediate story filing through blogs or social networking sites like twitter. Laptops and cellphones will be barred.

A Moving Video of the Daughter of Sholom Rubashkin from Zalman Tevel on Vimeo.

The video, along with a link to a donation page run by the National Committee for Furtherance of Jewish Education, reminds members of the Jewish community that “Pidyon Shvuyim is one of the greatest mitzvos possible.” Pidyon Shvuyim is the doctrine that commands Jews to redeem captives, which, according to the Jewish law called the Mishneh Torah, “takes precedence over supporting the poor or clothing them.”  This belief is further explained in the Yoreh Dei’ah, Chapter 252, which states: “Ransoming Captives takes precedence over feeding and clothing the poor, and no mitzvah is as great as ransoming captives. Therefore, any money which is collected, even for a religious purpose, may be diverted to ransom captives even if it is raised for the purpose of building a synagogue…”

While non-Jewish readers may not understand the significance of “ransoming captives,” it has been a very real and unfortunate part of Jewish history. The first likely incident was highlighted in the Bible when Lot, nephew of Abraham, was taken captive during the battle between Mesopotamian and Canaanite kings. Enemies and rogues learned that taking Jews captive could be very lucrative since the community was mandated and bound by law to pay the ransom. Historically, then, Pidyon Shvuyim has been used to gather or collect funds for the release of prisoners of war or others being held hostage against their will.

According to information published by Shmarya Rosenberg at Failed Messiah, the pledge drive for the legal fund appears to be a continuance of a prayer vigil and other activities for the benefit of the Rubashkin family. Rosenberg notes that there is no way to designate specific purposes of Pidyon Shvuyim funds donated via the site, and that all donated funds will be placed in the Rubashkin legal defense fund.

“It has been a very challenging year for us,” Weiss notes in the video as photos of her father in custody are shown. She also notes that the situation has been an opportunity for the family to renew their faith.

“Now, a few days before Yom Kippur, I ask you to please open your hearts and help my father who never turned anyone down,” she says. “The lawyers estimate that from now until the end of trial it cost about $500,000.”

Yom Kippur, the Jewish Day of Atonement, begins at sundown on Sunday, Sept. 27, and ends at nightfall on Monday, Sept. 28. It is considered the holiest of holy days of the Jewish year.

Sholom Rubashkin served as the day-to-day manager at the Agriprocessors plant in Postville at the time of a massive immigration raid that resulted in 389 plant workers, most Guatemalan or Mexican, being detained by federal authorities. He was taken into custody by federal authorities in the fall of 2008, and is currently facing a litany of charges ranging from bank fraud to immigration-related offenses. Chief Judge Linda R. Reade ruled last month that due to negative media, Rubashkin could not receive a fair trial in Iowa and moved the proceedings to Sioux Falls, S.D. The trial is set to begin on Oct. 10.

Rubashkin and his legal team have launched a law suit against the federal government, citing that officials with Immigration and Customs Enforcement did not provide a response to a Freedom of Information Act request. Rubashkin asked the government to provide any and all documentation in relation to the May 2008 raid in Postville, which led to the 163 charges he now faces.

Rubashkin and several other members of plant management, including his father, A. Aaron Rubashkin, who resides in Brooklyn, N.Y. and founded the company, also face several thousand state charges of alleged child-labor law violations.

The plant, which has emerged from bankruptcy proceedings, is now organized with a new name, Agri-Star, and is under new management. It continues to operate in Postville.

Jewish Community Action, an organization that has remained involved in Postville in the wake of the May 2008 immigration raid at the plant, has developed a home-printed card to be sent to Daniel Hirsch of Agri Star for the Jewish New Year.

Rosh Hashanah signals a fresh start.

With it, may this year be filled with health and happiness for your company, for the workers at Agri Star, for the town of Postville, for consumers, and for the broader community.

In the spirit of new beginnings, we hope you will accept a meeting with the Postville Community Benefits Alliance to develop an agreement that will ensure:

• the health and safety of the workforce
• strong and open lines of communication with the town
• much business success, and
• renewed consumer confidence

L’shanah tovah tikatev v’taihatem

May you be inscribed and sealed in the Book of Life for a good year.

The card, which when folded is pre-addressed to Agri Star in Postville, is intended to be mailed prior to Sukkot, which is in early October.

“As the Jewish community prepares for the holiest of days of the year — a time for reflection, renewal and fresh starts — we invite you to join us in expressing our hopes for improved conditions and better practices under the new owners’ leadership,” Jewish Community Action notes in a prepared statement.

The Postville Community Benefits Alliance is comprised of several groups within and outside of the immediate community. Representatives from local religious congregations, various civic organizations and larger interested parties, including Jewish Community Action, play a role. It was formed in hopes that with better communication mistakes of the past will not repeat themselves.

The Agriprocessors meatpacking plant was the site of one of the nation’s largest single-site immigration enforcement efforts. A total of 389 workers, most from Guatemala and Mexico, were detained by federal authorities. Most faced criminal prosecution for identity theft-related charges and served five months in federal prison prior to deportation to their home countries.

The Agriprocessors plant was owned and operated by the Rubashkin family. The company founder was A. Aaron Rubashkin of Brooklyn, N.Y., and two of his sons, Sholom M. Rubashkin and Tzvi “Heshy” Rubashkin, lived in Postville and oversaw the plant operations on a day-to-day basis. The plant never fully recovered after the May 2008 raid. Shortly after Sholom was arrested by federal authorities in November 2008 on immigration-related charges, the company filed bankruptcy.

The physical plant and most of the fully owned equipment within was purchased by SHF Industries, run by chief executive Daniel Hirsh, and the company has been reborn as Agri Star.

Federal charges against Sholom Rubashkin and three other former supervisors remain pending, the trial set to begin on Oct. 13 in Sioux Falls, S.D. Sholom as well as Aaron Rubashkin and other former plant officials also face state charges for alleged violations of child labor laws. That trial is scheduled to begin next year.

The trial, currently scheduled for Oct. 10, involves immigration- and fraud-related charges against Sholom Rubashkin, son of company founder A. Aaron Rubashkin, and three additional supervisors — Brent Bebee, Hosam Amara and Zeev Levi.

The charges stem from a massive immigration raid and follow-up investigation at the Agriprocessors meatpacking plant in Postville. A total of 389 workers, most from either Guatemala or Mexico, were detained and charged by federal authorities with immigration-related offenses.

Reade had twice denied a change of venue request, but had left open the opportunity for defense attorneys to refile the request in the weeks before trial was scheduled to begin. The thought was that public sentiment that might have been impacted by media reports could be better measured at a time closer to the trial date.

In order to determine public sentiment, more than 500 random eastern Iowans were surveyed. Upon reading, Reade determined the survey responses “demonstrate that the prodigious amount of negative pretrial publicity has caused the vast majority of potential jurors to develop and maintain a pervasive, strong bias against Defendants Rubashkin and Agriprocessors.”

“Based on the court’s analysis of the juror questionnaires, this bias would directly impact the ability of nearly all of the potential jurors to set aside their biases and decide the case based only on the evidence presented at trial,” Reade wrote in the order. “As a result, the court finds that the pretrial publicity in the community is so extensive and inflammatory that it raises a presumption that an impartial jury could not be seated in the Northern District of Iowa in October of 2009.”

Reade also states that she chose the Southern District of South Dakota (Sioux Falls) because “there has been only minimal publicity surrounding Agriprocessors and the instant action in that district” and also because the area is roughly the same size as the Cedar Rapids region. Reade closed her order with a reminder to counsel to refrain from speaking with the press, particularly publications in or around Sioux Falls.

The South Dakota location is convenient to the Northern District of Iowa given its proximity to court facilities in Sioux City, just 90 miles from Sioux Falls. It remains unclear, however, how convenient it will be for individuals in and around Postville who had planned to attend the trial.

It is also worth noting that although Rubashkin and his counsel argued for the change of venue, both the prosecution and counsel for Bebee resisted the change. Levi and Amara remain at large and took no part in the proceedings.

Rubashkin and several other members of plant management, including his father who resides in Brooklyn, N.Y., also face several thousand state charges of alleged child-labor law violations.

The case, which had been scheduled to start next month, was delayed after Judge Nathan Callahan received requests from both prosecutors and defendants. A new date has not been set, but the groups are scheduled to come back before the judge on Jan. 6, 2010 for a status hearing.

In September 2008, the Iowa Attorney General’s Office charged several persons affiliated with the Agriprocessors plant — the site of a massive immigration raid in May 2008 — with more than 9,000 counts of child labor law violations. Named in the state charges were A. Aaron Rubashkin (company founder and owner), Sholom Rubashkin (day-to-day chief executive officer), Elizabeth Billmeyer (director of human resources), Laura Althouse (human resources worker) and Karina Freund (human resources employee).

Nearly all of those facing these state charges have also been charged and/or faced federal immigration-related charges.

Today Joseph Sarachek, the Chapter 11 bankruptcy trustee for the beleaguered Agriprocessors meatpacking plant, filed a supplemental motion requesting the court reconvene the auction to consider the sale of the plant to SHF Industries, Inc. The actual sale of the plant, although recommended by Sarachek, must be approved by both the bankruptcy court and federal prosecutors.

SHF Industries, incorporated in Iowa, is owned by Hershey Friedman, a Canadian businessman, and two additional partners. Prior to presenting an offer for the plant, SHF first approached two key debt-holders and was able to hammer out an agreement to purchase their interests, according to documents filed with the court. Earlier court proceedings listed the major debt interests at over $20 million, Sarachek told the Associated Press that the actual buyout was “significantly less.”

With the two key debt holders placated, however, it is much more likely that a bid for the plant will be successful.

Agriprocessors, the site of a massive immigration raid on May 12, 2008, never fully recovered when 389 workers were bussed out of town by more than 800 Immigration and Customs Enforcment agents. Federal prosecutors, once finished with the immigrant workers, began picking their way up the plant’s management team. The arrest of Sholom Rubashkin, a son of company founder A. Aaron Rubashkin, led to the Chapter 11 filing and the temporary closing of the plant.

SHF, according to court documents, is offering an “as is, where is” sum of $8.5 million in addition to what has already been invested in existing debt. SHF is also willing to allow the existing trustee continued access to records.

“The condition to closing is the entry of an order by the bankruptcy court authorizing the sale of the assests to SHF, free and clear of all claims, liens and other encumbrances. … SHF is not acquiring, nor assuming, any debts or obligations of the debtor or the estate.”

Finally, SHF, according to the motion filed by Sarachek, is willing to provide the court with an affadavit, “sworn under the penalty of perjury,” that establishes any connections or affiliations the company has either with existing creditors or other parties of intest in the case, including members of the Rubashkin family or any of the multiple corporations the family has created.

The sale needs the approval of federal prosecutors not only due to continued criminal investigations and charges against former plant operators, but because the sale, as described in court documents, would also include certain company trademarks — items the federal government have already marked for forfeiture.

More details regarding the offer should be forthcoming when Sarachek files an asset purchase agreement with the court prior to a continuance of the bankruptcy sale.

The plant, which filed for Chapter 11 bankruptcy last fall, has been operating under the auspices of Joseph Sarachek, a court-appointed bankruptcy trustee, and with the help of a line of credit provided by St. Louis-based First Bank Business Capital, a company that was already owed more than $30 million by the meatpacking company.  Potential bankruptcy sales stalled in late March after two days of mediation when bids were determined too low by existing credit holders. The circumstance prompted First Bank to announce that it was no longer interested in providing a line of credit to keep the plant in limited operation during the course of the proceedings.

“We, perhaps more than anyone, have contributed to the effort to find real-life value for this estate in addition to our pre-petitioned debt,” Lloyd Palans, attorney for First Bank, told the court during the March discussions.

The company that has agreed to purchase the $10 million line of credit and keep the plant in operation remains a secret, according to a report filed today by the Associated Press.  In addition, Sarachek would not disclose how much was paid by the undisclosed company to take on the debt. Sarachek did say, however, that the company was willing to take this step because it is “presumably” interested in ultimately purchasing the plant.

Agriprocessors, once of the nation’s largest producers of kosher meat, never fully recovered from a May 2008 immigration raid that led to the detention of roughly half its workforce. Although it had previously been a producer of kosher beef and poultry, production lines since the bankruptcy have been limited to chicken.

Members Rubashkin family, owners of the Agriprocessors plant and other interests in and around Postville, have also filed Chapter 11 bankruptcy for several property management companies. Sholom M. Rubashkin, son of company founder A. Aaron Rubashkin, has been charged with numbers state and federal offenses. Several additional members of upper and lower plant management have also been charged, primarily on immigration-related offenses.