A Jewish man who headed the Orthodox Union (OU) chapter in the Ukrainian city of Kharkov was arrested this week on suspicion of embezzling community money, Ukrainian media reported.
The man, D., was reported missing in the beginning of the week, and found four days later hiding in the city of Dnepropetrovsk. He was arrested by the police and later confessed, in a television interview that he had gambled and lost some $1 million on the London Stock Exchange. He reportedly leveraged six apartments that belonged to the Kharkov OU to raise the money.
In the interview he explained that he had left Kharkov fearing sanctions from the banks and the infuriated reactions from his own community.
According to the JTA, D. is facing charges of business fraud and feigning his own kidnapping.
The OU is one of the major Jewish organizations in the United States which focuses, among other things, on supporting Jewish communities in Eastern Europe.
The OU's branch in Israel, which also oversees the Ukraine chapter, denied any relation to the affair. "He is not connected to the OU; the entire affair has nothing to do with the OU," local representative Shlomo Asraf told Ynet.
"This is the head of a local Jewish community that has nothing to do with Israel or the US," he added.
However, Chabad emissary to Kharkov Moshe Moskowitz said that the community in question was indeed funded by the OU and that D. had leveraged apartments belonging to the organization in order to raise money for his private investments.
"D. apparently had authorization from the donors to represent the organization in the city in order to develop the community. At present, after what had happened, he is no longer a representative of the OU and has no relation to the organization," he explained.
Moskowitz said that the OU owned five buildings that were used for educational activities, including one that housed a school for some 100 children. The apartments have now been transferred to the banks.
The OU's central headquarters in the US has declined to comment on the affair at this stage.