WFAN Sponsor in Alleged Ponzi Scheme
By Mike Silva ~ December 13th, 2009. Filed under: Sports Media Commentary.
Kars4Kids has a punchy radio jingle that drives some people crazy.
But the Lakewood-based nonprofit organization — which solicits car donations for disadvantaged children — is now one of dozens of charities embroiled in a federal court fight involving allegations of a massive, international Ponzi scheme. – Ted Sherman of the Star Ledger
Back on November 20th this site passed along an article by Mitch Lipka of Consumer Alley regarding concerns over deceptive advertising practices by popular WFAN sponsor Kars4Kids. This site demanded that Mark Chernoff take action so that his listeners (aka your customers Mr. Chernoff) would no longer be subjected to the incessant jingle. Apparently Mr. Chernoff was too busy putting together his “hunger drive” or figuring out how to spin his radio ratings to take action. I received numerous reports from listeners that Kars4Kids continued to run on WFAN, although I did not personally hear it myself.
Today the Kars4Kids story takes another twist as Ted Sherman of the Star Ledger reports about an alleged Ponzi scheme with the charity. According to Sherman “The allegations don’t involve money that’s generated when cars are donated to the charity. Instead, the court papers suggest the man at the center of everything, 34-year-old Eliyahu Weinstein, made multimillion-dollar payments to Kars4Kids and other charities as a way to hide assets.”
Weinstein is “a member of Lakewood’s ultra-Orthodox Jewish community, and a former used car salesman, is being sued by former partners across two continents who say he duped many of them — most of whom are also members of Orthodox Jewish communities — promising to invest their money in projects that did not exist.”
You should read the rest of the story as it gives details about the complicated situation. To be fair Kars4Kids is innocent until proven guilty, and they are calling the allegations “wildly speculative,” and said the payments cited by Weisbrot were the result of the sale of real estate.”
At this point I think it remains fair to question WFAN’s choice of sponsors. Shouldn’t they take the Kars4Kids ads down until this situation is resolved? Why continue to bombard the listeners with an annoying jingle for a company that is accused of false advertising and a potential Ponzi scheme? Would Mr. Chernoff run ads for people to invest with Bernie Madoff after his story came out? Does WFAN, who continues to tout itself as the leader in New York sports radio, want to protect their brand? Why should I listen to a station that has no respect for me as a customer?
This brings up more questions to me, again as a customer, about what is going on with the management of the station. Why hurt the brand for a few bucks? It’s disrespectful to hard working hosts like Evan Roberts, Mark Malusis, and others. Obviously WFAN is not directly responsible for Kars4Kids, but advertisers are part of their brand and they should be aware how this negative publicity impacts their operation. Especially when Kars4Kids seems to be a huge sponsor that is given tons of air time. This indicates, in my opinion, the FAN is not as healthy as they present to the public.
WFAN was saved by Mike Francesa’s scoop about the Jason Bay offer. If not, they would have been persona non grata during the Winter Meetings. If ESPN had any kind of signal, and plan, they could knock these guys off. That is another story for another day.
Let’s see what Mr. Chernoff’s response will be. Perhaps he is on vacation and we will endure the Kars4Kids jingle for a couple more weeks. Not only do we have to endure the inappropriate rants of Craig Carton, now we have to be subjected to dubious advertising, that gets more dubious, each day. Until management is cleaned up at WFAN I believe that we will be subjected to an inferior product and more trashy advertising. This is unfortunate because I think highly of many of the hosts outside of Francesa and Carton.
Mr. Chernoff as I say every time I write about your station – iceberg ahead!
Hat Tip to FailedMessiah.com for sending this link to me.
December 13th, 2009 at 2:53 pm
The Kars4Kids ad is bad enough but how about the condom and male enhancement commercials the WFAN airs as well? They might as well go back to the first days of WFAN when Eucliptement and the Kew Motor Inn were the stations major sponsors
December 13th, 2009 at 2:55 pm
Sure , Mike – i agree with you . Take down the ad because someone accused Kars4Kids – thats real AMERICAN justice . So i hope for your sake Mr.Silva that someone doesnt accuse you of anything – because we would have to fire you untill we found out you were innocent .
Hat Tip to FailedMessiah.com for such great investigative writing
December 13th, 2009 at 11:38 pm
Lakewood, NJ – Kars4Kids has written to VIN News a response to the December 12th article in the Newark Star Ledger [not posted on VIN News] involving the suggestion that Kars4Kids or any of its related charities have been involved in financial misdeeds, including money laundering or other illegal practices. Not only are any such suggestions completely false the newspaper report is based on unjustified accusations in court papers from a court case that has nothing at all to do with Kars4Kids. Those papers do make serious accusations against a number of charities involving millions of dollars. BUT KARS4KIDS IS NOT ONE OF THEM!
The article states at the very beginning that “At issue are millions in payments to Kars4Kids and more than 60 other registered charities.” This is completely misleading. No one — not even the lawyers who made the original claims — has EVER said that “millions” of dollars having anything to do with Eliyahu Weinstein have ever been paid by, through or to Kars4Kids. (In fact Mr. Weinstein has never even donated to our charity!) Of all the transactions involving Kars4Kids that the lawyer in question claimed “carry the scent of money laundering,” despite the impression left by the newspaper article, KARS4KIDS IS NOT ONE OF THEM!
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In fact, the same lawyer who made these claims filed an extensive list in court detailing the “millions of dollars” he thinks may be money laundering, down to the penny. Anyone can download this list from the Internet. It names every one of the 68 Jewish charities he is accusing of possible involvement in this crime and the specific amounts involved. KARS4KIDS IS NOT ONE OF THEM!
The Star Ledger chose to write about the “local angle” — a New Jersey charity whose name people recognize because of its success. The magnetism of such a story to its readers, when mixed with the “religious wrongdoers” claims, was raw meat to the newspaper. It was prepared to publish this story no matter how desperately it had to cut and paste unconnected “facts” or even unconnected accusations. There are serious accusations against charities in this lawsuit, but KARS4KIDS IS NOT ONE OF THEM!
So what is the Kars4Kids “connection”? A few years ago Kars4Kids was involved with a single transaction with a third party. That third party in turn conveyed money to the defendant in that lawsuit, Eliyahu Weinstein, with no direct involvement of Kars4Kids. Two years prior Oorah, Inc., a related charity, exchanged its old office 421 West County Line Road for the office building located next door to its current headquarters at 1785 Swarthmore. The lawyer involved in the present Weinstein litigation, seeing the name of Kars4Kids in banking records produced in the case, served us with a subpoena so he could satisfy his clients that nothing “went on” with Kars4Kids and his client’s money. We resisted the subpoena at first because it was unnecessarily invasive and broad. Our charity has nothing to hide, but is obligated to protect its donors privacy and its own private information. We filed a motion in that court to quash the subpoena and eventually worked out a friendly agreement to give them what they needed to go on with their case. That litigation is going on and involves a large number of accusations, suspected transactions and defendants. KARS4KIDS IS NOT ONE OF THEM!
Kars4Kids is the real deal. We have nothing to hide and because the public has supported our programs so generously we have no need to make money the dishonest way, and never have. There are lots of negative stories out there, unfortunately, that put Klal Yisroel in a bad light, and a lot of people and institutions that bear great guilt for causing Chillul Hashem by their actions. KARS4KIDS IS NOT ONE OF THEM!
December 14th, 2009 at 12:14 am
Here’s what the lawyer had to say on teh Star-Ledger website:
This is now in the comments on the Star-Ledger site:
My office represents Kars4Kids, and I am writing to respond to your December 12th article involving the accusations by the lawyer for one of the parties in a case to which my client is not a party.
My own comments to Ted Sherman, your reporter, are reported accurately — at the very end of the article, unfortunately, and well after the false implications about my client have made their impression. In fact, the statements by the attorney involved, and the way they were reported, leave a completely false impression of the truth of the matter.
The article states, very early on, “At issue are millions in payments to Kars4Kids and more than 60 other registered charities.” This is extremely misleading, because no one — not even the desperate attorneys that began this smear campaign for their own purposes — has so much as alleged this. No “millions” of dollars having anything to do with Eliyahu Weinstein have ever been paid to, through or by Kars4Kids.
The fact that your reporter chose to write about the local angle involving the unfounded accusation against Kars4Kids does not justify this false implication. It is also highly irresponsible, and a serious question of legal ethics and basic morals, for a lawyer to tell a court or a reporter that, in his “opinion,” vaguely unidentified financial transactions whose details he admits he does not know “carry the scent of money laundering.” We are preparing an attorney ethics complaint based on these statements.
It is not surprising that a newspaper would “run with” these reckless statements and choose a damning headline and lead for its story. But the Star Ledger article also demonstrates irresponsibility by suggesting that numerous vague and sensational accusations by the attorney in question regarding various unnamed charities were made, or could have been made, about Kars4Kids, which they were not. Readers incorrectly may assume some sort of wrongdoing or guilt by association — and association not with a case of proven liability, much less criminal guilt, but pure innuendo by a very biased advocate.
The nature of the comments already published online in response to this story demonstrate the power of such distortions, and the ugly face of prejudice given the slightest justification for expression. Given its constituency and its history, the Star Ledger of all papers should know better, and its editorial choices here are very regrettable.
Ronald D. Coleman
GOETZ FITZPATRICK LLP
Glen Rock