[Congressional Record Volume 140, Number 21 (Wednesday, March 2, 1994)]
[Senate]
[Page S]
From the Congressional Record Online through the Government Printing Office [www.gpo.gov]


[Congressional Record: March 2, 1994]
From the Congressional Record Online via GPO Access [wais.access.gpo.gov]

 
           ON THE SHOOTING OF FOUR STUDENTS IN NEW YORK CITY

  Mr. MOYNIHAN. Mr. President, I rise to draw the attention of the 
Senate to a terrible crime committed yesterday in New York City. At 
10:54 a.m. yesterday, on an on-ramp to the Brooklyn Bridge, a lone 
gunman driving a blue Chevrolet opened fire on a van carrying 15 to 16 
Hasidic students. The students were returning to Brooklyn after 
visiting the spiritual leader of the Lubavitcher sect, Menachem Mendel 
Schneerson, who was recovering from minor surgery at Manhattan Eye, 
Ear, and Throat Hospital.
  The gunman pursued the van onto the bridge, reportedly firing at 
least 11 shots from one or more semiautomatic weapons.
  Four young men were injured; two critically. A 15-year-old, Aaron 
Halberstam, the personal student of the Lubavitcher Rebbe, has been 
declared ``clinically brain dead'' by doctors at St. Vincent's Hospital 
in Manhattan, where all four victims have been receiving care.
  A second victim, Nachum Sossonkin, 18, was also struck in the head by 
gunfire, and is given little hope of recovery. The third victim, Levi 
Wilhem, 18, is in stable condition after undergoing surgery to remove a 
bullet from his abdomen. The fourth victim, Yaakov Shapiro, also 18, 
was treated for minor wounds to his hands and released.
  According to New York Police Commissioner William Bratton, who spoke 
at a press conference at 3:45 p.m. this afternoon, a suspect 
apprehension is, of course, a tribute to the abilities of the New York 
City Police Department, many of whom worked through the night on the 
investigation that led to the suspect's arrest.
  The suspect, Assad Baz, 28, is a Lebanese National who came to the 
United States in 1984. His current immigration status is being 
investigated. He has been charged with 15 counts of attempted murder, 3 
counts of assault in the first degree, 1 count of assault in the second 
degree, and numerous weapons charges.
  Police have recovered a Glock 9mm semiautomatic handgun, a Luger 
semiautomatic submachine pistol, a .380 caliber semiautomatic handgun, 
and a Street Sweeper, which is a semiautomatic shotgun capable of 
firing 12 shotgun shells in 3 seconds.
  It is not yet known with absolute certainty whether the gunman 
targeted his victims because they were Jewish. It seems unlikely that 
they were chosen at random.
  Mr. President, this is beyond our worst nightmares. We have come to a 
point where people are killed not for what they say or do, which is 
awful enough, but merely for who they are or what they believe. Just 
2\1/2\ years ago, Yankel Rosenbaum was stabbed to death in Crown 
Heights because he was Jewish. I said at the time that it was a 
lynching.
  Earlier today, New York Mayor Giuliani called me to discuss the 
latest developments in the case. An individual committed this crime. 
One person has been charged thus far, no more than that. What we must 
condemn is the crime; in no way do we condemn the nationality or 
religion of the person or persons responsible.
  Mayor Giuliani is surely to be commended for his handling of this, 
his first such incident since taking office in January.
  Mr. President, our prayers are with the young men who were shot and 
with their families. I ask unanimous consent that an article from 
today's New York Post about young Aaron Halberstam be printed in the 
Record.
  There being no objection, the article was ordered to be printed in 
the Record, as follows:

                [From the New York Post, March 2, 1994]

                     Victim Was Rebbe's Chosen One

       When Aaron Halberstam was 3, the man known by many in Crown 
     Heights as the messiah hoisted him upon his knee.
       ``Aleph, bet . . .,'' the holy man began.
       It was a simple lesson the Hebrew alphabet--one every 
     yeshiva boy learns as soon as he can walk. But to Ari 
     Halberstam, it was something more.
       At the age of 3, he alone was chosen to be the personal 
     student of Rebbe Menachem Schneerson. ``He's the only boy the 
     rebbe sat on his leg,'' a friend told me with admiration.
       In Crown Heights, where Lubavitcher boys study from sunup 
     to long past sundown, Ari Halberstam was known to all as 
     someone special.
       Last night, the gravely injured boy would need every prayer 
     the community could muster as he fought for his life.
       Ari grew up in a family that orbited the inner rung of the 
     rebbe's circle, a boy fiercely devoted to the holy man who 
     gave him language. And so it was fitting yesterday that Ari 
     rose at 5 a.m., to accompany his mentor to the hospital. That 
     he should be sacrificed as a result of the small act of 
     kindness weighed heavy on the hearts of the boys studying 
     late into the night at yeshiva Ohelei Torah.
       ``He felt such love for the rebbe,'' a classmate said. ``He 
     felt he must be there with him.''
       Last night, long after dark, a time when ordinary 
     youngsters have settled down in front of the TV, yeshiva 
     Ohelei Torah was alive with the serious words of study and 
     the rhythmic melody of prayer. Like most young men his age. 
     Ari spent most of his waking hours in this run-down school of 
     chipped paint and ancient wooden desks on Troy Avenue.
       There are no fancy computers here, no jazzy texts. Yet the 
     constant flow of eager-faced boys, draped in prayer shawls, 
     talking excitedly, ignites a life into these grim 
     surroundings you don't often see in the most modern of 
     institutions.
       As the school hummed with purpose, it was as if the very 
     building awaited Ari's return.
       Atop a wooden desk, Ari's textbook sat, open to the page of 
     Talmudic study where he had left off just a day earlier. It 
     is jammed with looseleaf sheats, all covered in the neat, 
     even letters that Ari learned so carefully from the rebbe.
       ``Because he stole from a high priest, he has to give it 
     back,'' reads one entry on Talmudic law.
       There also are things that the rebbe could not have taught 
     him--the doodles and daydreams of a boy of 16. Ari may be 
     special, but he is a boy.
       There is a hand-drawn picture of a youth trying to sneak 
     into class. ``You're late,'' someone yells. There also is a 
     caricature of a bearded, bespectacled man--Ari's teacher? On 
     one entire page, Ari has practiced his signature, the letters 
     getting taller and dreamier with each try.
       Another page is halting. ``If he is not breathing,'' Ari 
     wrote, ``you take him out because even if there are broken 
     bones it doesn't matter because he will die.''
       It turns out to be a lesson in first aid. One of the last 
     lessons he has written.
       The boys of Ari's class passed around the book last night, 
     as if it offered some connection to the missing boy. They 
     were careful not to disturb the pages, in case the owner 
     should need them.
       The students talked of Ari, with respect and with sadness. 
     His father, they told me, was the driver for the rebbe's late 
     wife, a position of great prominence in this community. And 
     when the woman died, it was Ari who was bequeathed her prayer 
     book, a holy artifact in these parts.
       But Ari also was an athlete, a scholar and a regular guy. 
     ``He didn't boast,'' said Moishe Levin, 15. ``He was not a 
     big showoff.''
       Moishe was at school last night, instead of the hospital, 
     for one simple reason: He did not wake up early enough to 
     accompany the rebbe to Manhattan. Like virtually every other 
     Jew in Crown Heights, he was convinced the shooting of his 
     friends and classmates was the work of those out to kill Jews 
     in retaliation for events in Israel.
       And it could happen again.
       ``It is very scary,'' a boy named Yitzhak said. ``It could 
     happen anywhere.''
       So the wave of international terror has been felt in this 
     rundown building on Troy Avenue, where a boy's book sits, 
     open, to the words he learned from a holy man. Yet here, 
     there is no talk or revenge. Just of a boy. A special boy.
       I ask Moishe if he wants to fight back. He said no.
       ``All you can do is pray,'' he said. ``Violence is not the 
     way to go.''

  Mr. WARNER. Mr. President, I draw my colleagues attention to an 
extremely disturbing article which appeared recently on the front page 
of the Washington Post. The article, entitled ``Marines Toys for Tots 
Spent Millions on Itself; Donations Used to Run Charity, Not Buy 
Gifts,'' reported that the highly respected Toys for Tots Program had 
collected nearly $10 million in the past 2 years, none of which was 
used to purchase toys for underprivileged children.
  Mr. President, I find that headline somewhat misleading. The story 
failed to make clear that underprivileged children were not the only 
victims of this scenario--the U.S. Marine Corps Reserve, long committed 
to the Toys for Tots Program, also has been damaged. I would like to 
take this opportunity to set the record straight.
  The Marine program is not at fault--the charitable foundation 
augmenting the program went astray.
  The article describes a problem with national charities which I have 
been trying to correct legislatively, without success, for 2 years. I 
raise this case as a signal to all of that intent to relentlessly press 
on until this body joins me in addressing the issue. Unfortunately, 
this case is another sequel to the tragic problems that hurt the United 
Way.
  Marine Reservists lend their name, commitment and untold volunteer 
hours to this project, collecting toys across the country to distribute 
to needy children who might otherwise find the holidays a dismal 
prospect. Like all endeavors in which the corps participates, the Toys 
for Tots drive gained great success, transformed from a small, local 
drive into a respected nationwide endeavor. Ironically, success spelled 
the program's downfall.
  The program's rapid growth took it far beyond the management scope of 
Marine Corps Reserve volunteers. In a single season alone, 7.5 million 
toys were distributed to 3.5 million needy children. To ensure 
effective management of this burgeoning success, the Toys for Tots 
Foundation, a civilian enterprise separate and distinct from Marine 
Reserve forces or the Marine Corps itself, was created to help hard-
working Marines collect large sums of money to purchase needed toys. 
The corps continued to associate its name with the program it had 
created, believing that the foundation would provide relief from the 
complex management problems associated with charitable fundraising on 
such a large level. Marine Reservists would then be freed to do what 
they do best: collecting and distributing toys for deserving youngsters 
during the holidays.
  Unfortunately, that happy ending does not fit this story.
  By now, my colleagues will be aware of legislation I have introduced 
to require heightened disclosure from tax-exempt and charitable 
organizations. When I initially introduced the measure some year and a 
half ago, I was responding to a situation I hoped to be fairly 
isolated: the much ballyhooed high-flying lifestyle of the then-head of 
the United Way, William Aramony. Regrettably, that situation was not 
isolated. Abuses and mismanagement of donated funds continue at an 
alarming rate within some charitable organizations, including the Toys 
for Tots Foundation. Indeed, the past civilian president of the 
foundation is being investigated for financial improprieties.
  I am aware that many charities are run in an organized manner, with 
full disclosure and excellent use of charitable contributions. These 
are obviously not the organizations I am targeting. Further, these 
well-run organizations should welcome my efforts; heightened disclosure 
will reassure donors that their contributions are being well-spent, and 
that will fare well and instill renewed confidence in all charitable 
organizations.
  In light of situations such as these, it is evident that my 
legislation remedy continues to be both needed and timely. I find it 
somewhat ironic that, had my measure been enacted shortly after it was 
first introduced, the recent Toys for Tots incident might have been 
avoided.
  Toys for Tots is a worthwhile effort. Thousands of Marine Corps 
Reservists committed to the program deserve our thanks and 
commendation. It is unfair and unacceptable for their reputations to 
have been tarnished by actions for which they bear no fault.
  We also owe a debt of gratitude to the even greater numbers of 
generous Americans who contributed to the Toys for Tots Program.
  What will it take to stop this train? How many times must I come to 
the Senate floor to implore my colleagues to stop looking the other 
way, to demand accountability from charitable organizations who take 
money from inherently goodhearted Americans?
  Mr. President, this is another in a series of articles that really 
began with the United Way tragedy where the press have exposed the fact 
that certain well-recognized, well-accepted, well-funded, well-
supported charities have taken these donations and used them in such a 
manner inconsistent with the objectives publicly stated by the charity. 
In this instance all of the money basically went to run the charity.
  Mr. President, I have introduced in this session of the Congress S. 
565, together with the distinguished senior Senator from North 
Carolina, legislation to begin to require these charities to make 
greater public disclosure of their internal operations of the dollars 
raised and how they are used.
  Mr. President, I ask unanimous consent that the text of the bill and 
additional material be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                 S. 565

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. IMPROVED DISCLOSURE TO DONORS BY TAX-EXEMPT 
                   ORGANIZATIONS.

       (A) In General.--Section 6033 of the Internal Revenue Code 
     of 1986 (relating to returns by exempt organizations) is 
     amended by redesignating subsection (e) as subsection (f) and 
     by inserting after subsection (d) the following new 
     subsection:
       ``(e) Additional Requirement For Tax-Exempt 
     Organizations.--
       ``(1) In general.--Except as provided in paragraph (2), any 
     organization described in section 501(c)(3) or 501(c)(4) and 
     any separate segregated fund described in section 527(f)(3) 
     maintained by such organization, which is subject to the 
     requirements of subsection (a) shall--
       ``(A) advise each contributor of the availability of a 
     disclosure statement described in paragraph (3), and
       ``(B) shall furnish such statement upon written request 
     to--
       ``(i) such contributor, or
       ``(ii) any potential contributor,

     within 30 days of such request.
       ``(2) Exception.--Paragraph (1) shall not apply to--
       ``(A) any organization described in clause (ii) or (iii) of 
     section 170(b)(1)(A)), or
       ``(B) any organization the gross receipts of which in each 
     taxable year are normally not more than $100,000.
       ``(3) Disclosure statement.--The disclosure statement 
     described in this paragraph is a statement for the most 
     recent taxable year for which a return under subsection 
     (a) has been field, which contains the information 
     described in--
       ``(A) paragraphs (1), (2), and (3) of subsection (b), and
       ``(B) paragraphs (6) and (7) of subsection (b), but only 
     with respect to--
       ``(i) the 5 highest compensated individuals of the 
     organization for such taxable year, and
       ``(ii) any other individual whose total compensation and 
     other payments from such organization for such taxable year 
     exceeds $100,000.
       ``(4) Processing Fees.--Any organization furnishing a 
     disclosure statement under this subsection may require that a 
     self-addressed, stamped envelope and a fee not to exceed $2 
     to cover the costs of copying and mailing such statement be 
     included in the written request for such statement.''.
       ``(b) Penalty for Failure To Meet Requirements.--Paragraph 
     (1) of section 6652(c) of the Internal Revenue Code of 1986 
     (relating to returns by exempt organizations and by certain 
     trusts) is amended by adding at the end the following new 
     subparagraph:
       ``(E) Disclosure statement.--In the case of a failure to 
     comply with the requirements of section 6033(e)(1) (relating 
     to disclosure statements provided upon request), there shall 
     be paid by the person failing to meet such requirements $50 
     for each day during which such failure continues.''.
       ``(c) Effective Date.--The amendments made by this section 
     shall take effect on January 1, 1994.
                                  ____


            Marines' Toys for Tots Spent Millions on Itself

                             (By Liz Spayd)

       The Marine Toys for Tots Foundation, the chief fund-raising 
     arm for the Marine Reserve's Christmas gift drive, has 
     collected nearly $10 million in the last two years through a 
     direct-mail campaign, but foundation officials acknowledge 
     that none of the money has gone to buy toys for needy 
     children.
       The charity also is the target of a federal probe into 
     whether its former president diverted money from the 
     nonprofit organization and engaged in other financial 
     improprieties for his personal benefit, according to 
     foundation officials and others familiar with the 
     investigation.
       Marine Reserve officials said they are scrambling to 
     correct the problems, but said they are worried that the 
     foundation's questionable management practices will 
     jeopardize the success of the annual gift drive, which began 
     more than 40 years ago.
       While toys donated to individual reserve units across the 
     country are reaching children who need them, most of the 
     money donated through the reserve's three-year-old foundation 
     is not.
       Of all the money the foundation raised in its most recent 
     fiscal year--including corporate gifts and those from federal 
     workers through the Combined Federal Campaign--10 percent 
     went to buy toys, foundation officials said. The rest was 
     spent on management, fund-raising expenses and materials used 
     to promote the reserve's toy appeal.
       And for the second year in a row, the donations mailed in 
     by more than 200,000 people across the country did not cover 
     the cost of running the foundation's massive direct-mail 
     effort, according to the charity's records.
       ``This foundation has been an embarrassment,'' said retired 
     Lt. Gen. Matthew T. Cooper, who took over the nonprofit's 
     reins five months ago. ``But we are trying to put the train 
     on the track, working seven days a week to assure the 
     public's money goes where it should.''
       Foundation officials said the most serious problems stem 
     from their former president and chairman, Jerry L. King, who 
     was dismissed last summer after the Buffalo News reported 
     that King had been convicted of tax evasion and conspiring to 
     deal in counterfeit money.
       Cooper said the foundation is cooperating with 
     investigators from the Justice Department and the U.S. 
     attorney's office in Buffalo in their efforts to determine 
     whether King took money from the charity.
       Both of those offices said they do not confirm or deny 
     investigations. King, reached at his home outside Buffalo, 
     declined to comment yesterday.
       After King left, Cooper said, numerous questions began to 
     arise about how the foundation's records were kept and 
     whether King was funneling money into toy companies in which 
     he had a financial interest.
       A newly completed audit by a Bethesda accounting firm, 
     Whelan, Barsky and Associates, said that so many invoices, 
     purchase orders and other records were missing that the 
     auditors could not document whether hundreds of thousands of 
     dollars worth of transactions were authentic.
       The financial report also raised questions about whether 
     the foundation paid for goods and services that were not 
     actually received. It questioned the foundation's 
     relationship with the two toy companies in which King had a 
     financial interest.
       Foundation officials said they have moved swiftly to put 
     the charity back on track: They installed a new president, 
     expanded the board of directors, instituted tighter financial 
     controls and moved the headquarters from Amherst, N.Y., near 
     Buffalo, to rent-free space at the Marine Base in Quantico, 
     30 miles south of Washington.
       But questions about their operations remain.
       In a report issued this week by the Better Business Bureau, 
     the foundation is cited as violating six of the consumer 
     watchdog group's 22 standards for charitable organizations. 
     Among the group's concerns are the amount of money spent on 
     fund-raising and management and the lack of complete 
     financial data on the foundation's operations.
       ``It is unfortunate that so much of their money is being 
     consumed by fund-raising costs and overhead,'' said Bennett 
     Weiner, who oversees the bureau's charity division. ``I would 
     think that should be a serious concern of contributors.''
       Cooper, who makes $100,000, and his operations manager, who 
     receives $45,000, are the only employees on the payroll. The 
     biggest expenses, records show, have been printing costs and 
     consulting fees paid to Steve Cram and Associates, a Fairfax 
     company that runs the foundation's direct-mail appeal.
       Cooper declined to discuss the terms of that agreement, 
     except to say that it is being reviewed so that the charity 
     can receive more favorable terms.
                                  ____


               [From the Washington Post, Feb. 10, 1994]

       Marine Charity's Former President Is Target of U.S. Probe

       ``My goal, and it is an optimistic one, is to have 75 
     percent of the money raised in the next mailing go toward 
     program expenses, with most of that going to buy toys,'' 
     Cooper said.
       Part of the problem, according to the foundation, is that 
     it is very expensive to initiate a direct-mail campaign.
       Fund-raising specialists agree that prospecting for new 
     donors through the mail can be a money-losing proposition at 
     first. But they also questioned why a charity that had sent 
     more than 14 million pieces of mail wouldn't have generated 
     some money for its cause.
       ``To have done that much mailing and not have anything to 
     show for it makes me think something is wrong. That's not 
     typical,'' said Hal Malchow, a direct-mail consultant to 
     several national nonprofit organizations.
       Foundation officials also defended the fact that only a 
     small percentage of donations received has gone to buy toys. 
     Part of their organization's purpose, they said, is to 
     educate the public on the needs of poor children and to 
     encourage them to donate toys to individual reserve units.
       Even with those expenses, the foundation said it still was 
     able to add 500,000 toys to the 8 million collected by 
     reserve units across the country last Christmas. The money 
     for those toys came from corporate donations and sources 
     other than the direct-mail campaign.
       Washington area residents contributed 160,000 of the toys, 
     which the local reserve unit says went directly to needy 
     families in the area.
       Sgt. Joseph Steigerwald, who heads the local toy drive, 
     said he has heard only rumor about the problems at the 
     foundation and was never told there was a federal 
     investigation or problems involving its operations.
       As is practice, money donated in Washington is sent to the 
     foundation. Steigerwald said that money has been available 
     when he needs to buy toys.
       Officials at the Marine Reserve's headquarters in New 
     Orleans said they are concerned about the problems at the 
     foundation and are conducting an annual review of the program 
     to ensure that the toy drive is operating efficiently and is 
     not jeopardized by the foundation's problems.
       ``We are reviewing the whole program, particularly in light 
     of the foundation and the investigation into it,'' said Maj. 
     Betsy Sweatt, director of public affairs for the Marine 
     Reserve.
       ``But Toys for Tots is a good program that has been serving 
     the community for years, and we want to make sure it stays 
     that way,'' she said.

  Mr. BYRD. I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The bill clerk proceeded to call the roll.
  Mr. LEVIN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
   The PRESIDING OFFICER. Without objection, it is so ordered.

                          ____________________