Rabbi hailed as hero after Poway synagogue shooting gets prison time for fraud

Despite plea deal, Yisroel Goldstein, wounded in 2019 attack that killed one congregant, gets surprising 14-month sentence for years-long, multi-million dollar financial schemes

Luke Tress is an editor and a reporter in New York for The Times of Israel.

Rabbi Yisroel Goldstein, right, walks with Poway mayor Steve Vaus, left, as he arrives for a news conference at the Chabad of Poway synagogue, shortly after a deadly shooting at the congregation, April 28, 2019. (AP Photo/Denis Poroy)
Rabbi Yisroel Goldstein, right, walks with Poway mayor Steve Vaus, left, as he arrives for a news conference at the Chabad of Poway synagogue, shortly after a deadly shooting at the congregation, April 28, 2019. (AP Photo/Denis Poroy)

The leader of a California synagogue, who was hailed as a hero after a deadly antisemitic attack on his congregation in 2019, was sentenced to prison on Tuesday for financial fraud.

Rabbi Yisroel Goldstein, head of the Chabad of Poway synagogue in southern California, was sentenced to 14 months for an array of financial crimes, the Southern District of California US Attorney’s Office said.

The sentence came as a surprise. Prosecutors had recommended Goldstein be sentenced to probation as part of a plea agreement, noting his cooperation with investigators and his response to the shooting that killed one congregant, Lori Gilbert-Kaye.

“His role after the 2019 terrorist attack was exemplary,” US Attorney Robert Brewer said when Goldstein pleaded guilty to charges of tax fraud and wire fraud. “He became a significant advocate for peace and elimination of violence based on religious hatred.”

The shooter, John T. Earnest, killed Gilbert-Kaye in the attack on the last day of Passover and blew off Goldstein’s right index finger and injured his other hand. Three other congregants were wounded, including an 8-year-old girl.

Goldstein, 60, entered the national spotlight after the attack as an advocate for tolerance and resilience. Former US president Donald Trump hosted Goldstein at the White House shortly after the shooting, calling him a “warm and incredible man.”

Former US vice president Mike Pence visited Goldstein at the Poway synagogue, and Goldstein addressed the United Nations General Assembly to decry antisemitism and other forms of racism after the attack.

US President Donald Trump looks on as Rabbi Yisroel Goldstein, survivor of the Poway, California synagogue shooting, speaks during a National Day of Prayer event in the Rose Garden of the White House, May 2, 2019. (AP/Evan Vucci)

Announcing the prison sentence on Tuesday, US District Judge Cynthia Bashant said, “You dragged down so many congregants.”

“Many of those individuals thought that they were committing these offenses to benefit the Chabad or the synagogue in general, when in fact it was to benefit you. I just can’t ignore that,” Bashant said.

“I think time in custody is important.  It’s important to send a message to the community, and it’s important to send a message to you,” she said.

Goldstein must also pay $2.8 million in restitution. His sentence begins on February 23.

Goldstein defrauded the IRS, several San Diego Fortune 500 companies and multiple public and private agencies, the court said.

“I stand here today, my head bowed in shame, remorse and disappointment over the crimes that I have committed to God and mankind,” Goldstein told the court on Tuesday, according to NBC San Diego.

Goldstein pleaded guilty to the multimillion-dollar fraud charges in 2020. His sentencing was delayed from last year due to the pandemic. He had faced a maximum sentence of five years in prison.

Goldstein admitted to years of financial malfeasance that began long before the shooting.

In his plea agreement, he said his crimes began in 2010, but prosecutors said they dated back to the 1980s. The IRS and FBI carried out search warrants at Goldstein’s residence six months before the shooting.

In the most severe of several schemes, Goldstein collected $6.2 million in fraudulent donations for the congregation and affiliated charities, then secretly returned 90% to the donors with fake receipts. The donors then used the fake receipts to claim huge tax deductions. Goldstein kept the other 10% for himself for a profit of $620,000.

Separately, he submitted fake invoices to the Federal Emergency Management Agency and California Governor’s Office of Emergency Services to claim $185,000. The invoices claimed government grants to repair the synagogue from wildfire damage that did not actually happen.

He also defrauded three Fortune 500 companies out of at least $144,000 by tricking them into matching fake charitable donations, then pocketing the contributions.

Lastly, he helped his brother hide $700,000 in income from the IRS with the help of Chabad bank accounts for a cut of his brother’s earnings.

At least 20 other people were involved in the fraud. Co-conspirator Alexander Avergoon was sentenced to 64 months in prison on Monday for crimes committed with Goldstein and other offenses.

Prosecutors said the synagogue was also victimized by the fraud by losing out on donations.

The synagogue received federal funding to step up its security shortly before the shooting, but had not had time to put the funds to use.

A photo of Lori Gilbert-Kaye at the Chabad of Poway, California, May 3, 2019. (Gabrielle Birkner/JTA)

Goldstein founded the Chabad of Poway synagogue near San Diego in 1986.

After the allegations came to light, Chabad-Lubavitch organization condemned his crimes as “terribly shocking and troubling,” relieved Goldstein of his role at the synagogue and dismissed him as a representative of the organization.

Chabad of Poway said after learning of the allegations, “Rabbi Goldstein violated the law, contradicted what our synagogue stands for, and transgressed the very moral and ethical rules of the Torah he taught.”

Goldstein’s son took over as the congregation’s leader after his father stepped down.

Earnest, the white supremacist who carried out the shooting, was sentenced to life in federal prison last month. Three months earlier, he was sentenced to a life term in state court.

Immediately after the shooting, Earnest called 911 to report the attack and said, “I’m defending our nation against the Jewish people, who are trying to destroy all white people.”

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