The brother of former Chabad of Poway Rabbi Yisroel Goldstein has reportedly been sentenced to eight months in custody for his role in an ongoing tax fraud scheme that prosecutors say also involved his brother.
Mendel Goldstein also faces a fine of $5,500 and is ordered to pay restitution in the amount of $164,475.82, according to a March 11 Department of Justice news release.
“It’s important to send a message. People need to know, this is what happens when you commit tax fraud,” District Court Judge Cynthia Bashant said.
According to the news release, for at least a six-year period, Mendel Goldstein hid all of his income by steering the income from his videography business through Chabad of Poway bank accounts that were controlled by his brother, Rabbi Goldstein. As part of the deal, Rabbi Goldstein is alleged to have taken a 10-percent cut of Mendel Goldstein’s income, who was able to access his funds by writing checks to himself from the Chabad of Poway bank account that concealed the true recipient of the money.
During the period in question, prosecutors said Mendel Goldstein concealed approximately $700,000 from the government, evading more than $150,000 in taxes. In 2018, authorities and Rabbi Goldstein alerted his bother to the investigation, prodding him to quickly file delinquent tax returns as a way of concealing his tax evasion.
As the investigation continued, in the summer of 2020 Rabbi Goldstein pleaded guilty to fraud charges, admitting he participated in a complex, years-long, multi-million-dollar tax-evasion scheme and other financial deceptions involving theft of public money.
“Our community should not tolerate tax fraud, and offenders will continue to be prosecuted,” said U.S. Attorney Randy Grossman. Grossman thanked the prosecution team and FBI and IRS agents for their excellent work on this case.
