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Trump administration to snap ties with Palestinians, no peace plan, no more monetary aid Dec 23, 2017 @ 18:44 Donald Trump, Mahmoud Abbas, Palestinians, Ramallah, US aid cutoff

The White House has decided to quietly withdraw from all its ties with the Ramallah-based Palestinian Authority and Mahmoud Abbas. DEBKAfile's exclusive sources report that the Trump administration has resolved to scrap all ties with the Palestinian leadership in retaliation for its campaign against US President Donald Trump and his Jerusalem policy. Several warnings to Mahmoud Abbas (Abu Mazen) of what was in store if he did not desist from castigating the US president fell on deaf ears. Last week, two Arab crown princes, Saudi Muhammed bin Salman and UAE Sheikh Muhammed bin Zayed, summoned Abbas to their capitals and urged him strongly to back away from his attacks on President Trump. He got the same advice from the ruler of Qatar, Sheikh Tamim Al Thani, who conferred with Washington on the subject – all to no avail. The Trump administration has therefore set out an eight-point program of sanctions, which is first revealed here:

The Israeli-Palestinian peace plan under preparation in Washington will not be submitted to Ramallah – only to Israel and the relevant Arab governments. US-Palestinian interaction is to be suspended – not just at the senior levels but in day-to-day interchanges. The administration has notified Palestinian and other Arab parties to stop addressing queries on political and economic matters to the US consulate in Jerusalem, because they will not receive answers. The status of the PLO office in Washington will be reevaluated with a view to shutting it down. Palestinian officials will no longer be invited to Washington by the US government, including the State Department and Department of Treasury. Above all, they will not be welcome at the White House or the National Security Council where US Middle East policy is designed. Senior US officials congratulated the senior Palestinian negotiator Saab Erekat, who also holds the PA's American portfolio, on his recovery from illness, at the same time warning him that he would no longer be received at the White House. The Trump administration will not make any public announcement of the cutoff of financial aid to the Palestinians. Since the funds are mostly earmarked for specific economic projects, each allocation will simply be held back on the pretext of the need for a "reappraisal." The US will halt its contributions to the UN Work and Relief Agency (UNWRA), an estimated one billion dollars per annum. The US administration moreover intervened with the governments of Saudi Arabia, Abu Dhabi and Qatar with a request that they freeze or slow their economic aid to the Palestinian Authority.

According DEBKAfile's sources, Palestinian officials in Ramallah were devastated by news of the sudden cutoff of the main sources of the PA's revenue. Even the Qatar ruler, whom Abbas visited last week as a last resort to save the PA from economic meltdown, refused to release any more funding.

Despite agreement, Mormons continue posthumously baptizing Jews

Mormons are baptizing Holocaust victims, Lubavitcher rebbe and celebrities, researcher says. Contact Editor
JTA, 23/12/17 18:11

Mormon church in Salt Lake City, Utah
Mormon church in Salt Lake City, UtahiStock

A researcher says Mormons have posthumously baptized the late Lubavitcher Rebbe, the grandparents of Carrie Fisher and Steven Spielberg, and hundreds of Holocaust victims, violating an agreement to halt the practice.

Helen Radkey, a Salt Lake City-based independent researcher who has been looking into the Mormon practice of posthumous baptisms for two decades, said there are hundreds of examples of Jewish Holocaust victims being baptized in Mormon churches around the world since 2012. In a report released this week, she shared names of 20 such people who had been baptized.

"There are at least hundreds, probably more," Radkey, a former Mormon who was excommunicated from the church in 1978, told JTA on Thursday.

The names cited by Radkey refer to Holocaust victims baptized from April 2012 and onward. In March 2012, the Mormon church, formally known as the Church of Jesus Christ of Latter-day Saints, sent a letter to its congregations reiterating a 1995 policy that members should only do posthumous baptisms on their own ancestors and forbidding baptisms of Jewish Holocaust victims and celebrities.

In addition to hundreds of Holocaust victims, Radkey claims to have found other examples of famous Jews being baptized. For example, she says the late Chabad-Lubavitch leader Rabbi Menachem Mendel Schneerson and his father, Rabbi Levi Yitzchak Schneerson, were baptized in 2015. So were philosopher Martin Buber in 2016, and the grandparents of Spielberg and Fisher in 2015 and 2017.

Radkey found the names in FamilySearch, a website used by Mormons to trace family lineages and submit requests for proxy baptisms. Her study was first reported by The Associated Press.

The practice of proxy baptisms is a controversial one. Mormons are instructed to perform baptisms on dead relatives who did not have the opportunity to convert to the church. However, in the 1990s it was discovered that Mormons had performed such rites on hundreds of thousands of Jews who died in the Holocaust. This angered Jewish groups, which said the practice disrespected the victims' religious beliefs.

In 1995, the Mormon church reached an agreement with Jewish leaders to cease the practice, and it was emphasized in the 2012 letter.

Radkey also says she found examples of family members of famous politicians, including Presidents Donald Trump, Barack Obama and Bill Clinton, as well as relatives of celebrities such as Kim Kardashian, being posthumously baptized.

Eric Hawkins, a spokesman for the Church of Jesus Christ of Latter-day Saints, said the church was doing its part to ensure there were no posthumous baptisms.

"The Church cares deeply about ensuring these standards are maintained," he said in a statement. "Each month, we receive a list of names of Holocaust victims from the [Simon] Wiesenthal Center in Los Angeles. These are added to our database of names that require a direct family connection before temple work can be requested or performed."

Four full-time employees at FamilySearch monitor the site for names of Holocaust victims and others that should not be added, Hawkins added.

The Anti-Defamation League, which has worked with the Mormon church on the issue, said the church was doing its part to prevent Holocaust baptisms.

"My sense is that they are making every good faith effort to first of all block these before they happen, [and] if in the case that something slips through and they become aware of it, they then remove it and reverse it," ADL's director of interfaith affairs, Rabbi David Sandmel, told JTA on Friday. "I'm satisfied that they take this seriously and that they are doing the best they can to fulfill the commitment they made on this."

However, Gary Mokotoff, a Jewish genealogist who has been involved in the issue, begged to differ.

"If the problem still exists, whatever the church is doing to prevent it is not working" Mokotoff told JTA on Friday.

"A single person called Helen Radkey can find hundreds, if not thousands, of examples of Holocaust victims being submitted for posthumous baptism, then why can't the church, which claims they actually have people working on it, find the very thing that Helen is finding?" he asked.

Mokotoff, who has relatives that died in the Holocaust, said the baptisms of Nazi victims were particularly jarring.

"These people died because they were Jews," he said, "and here you are bringing them into a second religion even though these people are not related to you."

The Simon Wiesenthal Center said the idea that Jews needed to be baptized was offensive. The parents of the center's namesake, famed Nazi hunter Simon Wiesenthal, have previously been baptized by Mormons.

"We were sure that these baptisms were removed but we're seeing that they're not," Rabbi Marvin Hier, the center's founder and dean, said in a statement emailed to JTA. "We reiterated yet again the reasons we protested that it's insulting that the People of the Book whom G-d made a Covenant would need the assistance of a group of Mormons to gain entrance to Heaven."

With few options, Israeli couples turn to rogue weddings

As the Chief Rabbinate grows stricter, around 20% of Israeli couples are opting to defy it and marry in unsanctioned weddings, says pluralist organization head - Among them are people who have difficulty proving Jewishness to rabbinic authorities. Associated Press and Israel Hayom Staff

Rabbi Chuck Davidson holds a wedding service in Ein Hemed, near Jerusalem | Photo: AP

Rabbi Chuck Davidson is a criminal in the eyes of Israeli law, although in most countries his crime would not warrant him being put behind bars. His offense: conducting rogue weddings, in defiance of Israel's Chief Rabbinate.

Even though Davidson belongs to the officially recognized Orthodox stream of Judaism, he is among a growing cohort of Jewish groups running afoul of the law by performing weddings without the rabbinate's sanction. Critics like Davidson believe the rabbinate has grown too strict in its interpretation of religious law, making it unnecessarily difficult for Jewish couples to marry.

"More and more Israelis are getting married outside the rabbinate," said Michal Berman, chief executive of Panim, an umbrella group representing Israeli Jewish pluralist organizations, which perform Orthodox, liberal and secular weddings in defiance of the rabbinate.

Berman said an estimated 20% of Israelis are marrying outside the rabbinate, compared to 16% in 2010. She expects that number to keep growing, which she considers a sign of a growing lack of faith in the religious body.

"There are plural ways of being Jewish and it's better to acknowledge it," Berman said.

Israel does not have a system of civil marriage, and Israeli law mandates that Jewish marriages must be conducted by a rabbi authorized by the Chief Rabbinate. That means Jewish couples wanting to marry in Israel have little choice but to undergo an Orthodox marriage.

An amendment to Israel's marriage law passed in 2013 made the punishment for anyone performing or taking part in an unsanctioned wedding two years in prison. Shortly afterward, Davidson, a 58-year-old American-born Israeli rabbi, started performing renegade weddings. He said he has conducted over 170 since then.

"An Elvis impersonator in Las Vegas has more meaning to the state than me, an Orthodox rabbi," said Davidson.

The existing marriage law prevents interfaith or same-sex weddings. It also rejects ceremonies conducted by more liberal streams of Judaism popular with American Jews.

However, interfaith, same-sex and civil marriages performed abroad are recognized retroactively by the Interior Ministry, making nearby Cyprus a popular destination for secular Israeli weddings. Israel also recognizes common-law spouses who share a home, though they do not have the same rights as married couples.

A poll conducted earlier this year by Hiddush, an organization pushing for religious pluralism in Israel, found that over 70% of Israelis support civil marriage.

Davidson has moved into an area where even Jewish men and women who ostensibly meet the rabbinate's standards run into problems trying to marry.

Such couples may lack documentation, such as their parents' wedding certificate, proving their Jewishness. Some turn to the rebel rabbi out of frustration with dealing with the rabbinate. Others may do so on principle.

Davidson estimates that around 400,000 Israeli Jews – or roughly 6% of the Jewish population – have "no marriage options" because they do not meet the rabbinate's stringent standards.

One Ethiopian Jewish woman who was married by Davidson in October said she objected in principle to the manner in which the rabbinate demands proof of Judaism.

"We're both certifiably Jewish," she said, speaking on condition of anonymity. She said she and her husband could have legally married through the rabbinate, "but we don't believe in the institution itself. I have no problem in principle with proving someone's Judaism, but the very concept of how the rabbinate perceives Ethiopian Jews is problematic for me, and I'm not willing to cooperate with an institution that doesn't consider me Jewish."

Nonetheless, she said it was important for them to marry according to Jewish tradition.

The group Havaya helps Jewish couples marry outside the rabbinate by organizing wedding ceremonies for partners who are recognized as common-law couples.

Havaya Director Inbar Oren said the organization has conducted several thousand weddings since it was established in 2007, allowing interfaith and same-sex couples in Israel to enjoy more egalitarian or secular ceremonies than the rabbinate permits.

"People are looking for a solution to their situation," said Oren.

While sending a defiant message, these weddings are not a complete solution. Because they are not legally binding, the couples must still either go abroad or go to the rabbinate for a private ceremony. The Ethiopian woman, for instance, said she and her husband are weighing recognition as a common-law couple or flying to Cyprus for a civil ceremony.

No one in Israel has been arrested or charged with participating in an illegal marriage, but Oren and Davidson wish someone would be.

"I don't hide this, I do this over the radar; I am hoping to be arrested," Davidson said.

He said being arrested would raise awareness "of how insane this is," and he was confident the Supreme Court would rule against the law.

"If not, I'll sit in jail," he said.

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Jerusalem Post Crypto Currency

Israel banking on 'digital shekel' cryptocurrency?


Tel Aviv stock exchange bans bitcoin-related companies >
Bitcoin fraud could be the next big thing for swindlers in Israel

By Max Schindler
December 24, 2017 15:32
The Bank of Israel has been examining the possibility of a state-sponsored currency for several months. 4 minute read.

Israel develops new 'bitcoin' currency (Illustrative)

Israel develops new 'bitcoin' currency (Illustrative). (photo credit: JPOST STAFF)

The Finance Ministry and Bank of Israel are considering issuing a digital currency, a possible response to the frenzied cryptocurrency and bitcoin craze.

The digital shekel would record every transaction by mobile phone and make it more difficult to evade taxation, according to a finance official who spoke to The Jerusalem Post on condition of anonymity.

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For several months now, regulators have been examining the possibility of a state-sponsored currency, and the government could review a tentative legal framework in January. The digital shekel would be identical in value to the physical shekel currently in use.

With cash, you make a transaction immediately, unlike with a bank transfer or check, which takes a few days to clear. Digital currency would act similarly to cash by not passing through a bank-clearing system, but rather changing hands immediately.

"You can imagine that instead of giving you a piece of paper saying the Bank of Israel on it, I can send you a piece of digital code that was issued by a central bank," the official said, with the digital currency being stored in a digital wallet.

It is unclear where the digital wallet would be located – either in a Bank of Israel account or on your mobile phone. And if somebody stole your phone, what would happen to your digital wallet?

It is possible that central banks may see digital currencies as a threat, undermining the centralized bank-clearing system. In that light, state-sponsored digital currencies may be an attempt to compete with decentralized cryptocurrencies such as bitcoin. It remains to be seen how digital currencies will affect the lives of consumers.

With bitcoin running on blockchain technology – a digitized and decentralized public ledger that allows you to reliably authenticate transactions – the Bank of Israel is also looking into incorporating blockchain into its operations.

What is the blockchain technology behind cryptocurrencies like Bitcoin and Ethereum? (REUTERS)

Yet bitcoin has faced daily volatility, with double-digit fluctuations in bitcoin-to-dollar conversions.

"Early on, when new things emerge and people struggle to understand how to value it, you get high volatility," said Lou Kerner, a partner at CryptoOracle, a venture-capital firm and bitcoin investor. "That doesn't mean that it's not a thing and it doesn't mean that it should be outlawed."

Kerner, who visited Israel earlier this month, weighed into the recent Israel Securities Authority decision to bar bitcoin-related companies from trading on the Tel Aviv Stock Exchange.

"Governments have two options," said Kerner. "They can either roll out the red tape or roll out the red carpet – and they roll out the red tape at their own peril. So, it turns out, these [bitcoin-related] companies will go somewhere else. And the Tel Aviv Stock Exchange loses out. It's like saying, `We won't allow Internet companies to trade.'"

A state-sponsored digital currency doesn't exist anywhere in the world, not even in Sweden, which has made the most progress so far in shifting away from cash.

For two years, the Knesset has looked into how to reduce the use of cash, according to TheMarker. Various constituencies in Israel, which are more prone to dealing in the black market, have pressured their politicians to forestall the move.

In order to issue a state cryptocurrency, the Bank of Israel's plans would need to be approved by the Knesset, the finance official added.

"There's a lot that people need to think about before going through with this reform," the official said. "We're looking at the legal, financial, regulatory and money- laundering sides of this."

Unlike bitcoin, where the set number of bitcoins is fixed, sovereign governments can print and issue however much state currency they desire. That hypothetically makes bitcoins more resistant to inflationary pressure – similar to gold – in terms of store value.

It may take some time for bitcoin to catch up, as the market capitalization of gold worldwide stands at some $8 trillion. The total value of all bitcoin in circulation is around $200 billion, according to Kerner.

"Gold has been a store [of] value for 5,000 years," Kerner said. "It turns out that nothing lasts forever. And now we have something that is a far better store of value, in that it's much easier to transmit and send and buy and sell than gold is. You can take all your bitcoins with you in a way that's very hard for you to take your gold. A sovereign nation can take your gold but it can't take your bitcoin."

And given that bitcoin is only the most famous application of blockchain so far, it's just a matter of time before a niftier, more efficient cryptocurrency replaces it.

Kerner analogized bitcoin's role to how the social-media site Friendster was eclipsed by MySpace, which was then replaced by Facebook.

"In terms of a store of value, bitcoin is better than the dollar, and something theoretically could come along and be better than bitcoin," Kerner said.

Are cryptocurrencies the future, and if so, what kind of a future are they?


Tel Aviv stock exchange bans bitcoin-related companies >
Israel banking on 'digital shekel' cryptocurrency?

By Seth J. Frantzman
December 24, 2017 23:47
Being versed in this new world is as important now as being versed in the Internet was for those growing up in the 1990s.

Are cryptocurrencies the future, and if so, what kind of a future are they?

A Bitcoin sign is seen during Riga Comm 2017, a business technology and innovation fair in Riga, Latvia.. (photo credit: REUTERS)

It's difficult to watch the news or surf the Internet without running into something about Bitcoin and blockchain.

On Facebook an ad suggests the "number 1 ICO [initial coin offering] for investors" and asks, "Have you ever wanted to know the secrets of the most successful cryptocurrency traders?" Every day brings news about these "cryptocurrencies." Bloomberg reports that Goldman Sachs is setting up a cryptocurrency trading desk. The Marker in Israel says that the Bank of Israel is looking into "digital currencies." Israel, especially, is well placed to take advantage of the new craze but its financial regulators are also wary of becoming a hub for fraud or part of a bubble.

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The first hurdle with this new world is understanding the lingo. When Long Island Iced Tea announced it was changing its name to "Long Blockchain Corp" it sought to cash in on the new fad. For shareholders this is a good deal as the stock jumped. But for others it's just mysterious.

What is "blockchain"? One colleague described it like Google Docs for the whole world, an internationally accessible set of contracts. Wikipedia explains that these are a continuously growing list of records, called blocks, "which are linked and secured using cryptography."

Nick Spanos, founder of the Bitcoin Center NYC in 2013 and CEO of Blockchain Technologies Corp, says that "institutions across the world use blockchain smart contracts to digitize guarantees and secure documents."

Spanos is a co-founder of the Zap Project, which works to solve one of the biggest challenges in the blockchain industry.

Spanos says that banks and intermediaries are no longer needed for anyone, anywhere in the world to transact and enter into contracts. "These transactions happen more securely, more quickly and usually at much lower fees," he wrote in an email. He argues that cryptocurrencies using blockchain could replace central banks one day because it is open-source. "Bitcoin represents the people's declaration of monetary independence."

Being versed in this new world is as important now as being versed in the Internet was for those growing up in the 1990s.

But the tsunami that is coming requires some navigation.

Bitcoin was created in 2009. It is the most well known of what are called "cryptocurrencies."

Ripple, another coin-style payment protocol, was released in 2012.

Ethereum was founded in 2015. There are other coins as well, a "Litecoin" and even a "Putin coin." Most famously, Bitcoin started 2017 at a price of $1,000 and was trading at almost $20,000 in mid-December. It lost some of that value on December 21, falling to around $13,000.

Cashing in on this ride has become the goal of many companies, who are seeking to find a way to access investors. But oldstyle banks and institutions such as stock markets are wary of listing companies that they see as gambling in these new technologies.

On December 19 the US Securities and Exchange Commission temporarily suspended trading in The Crypto Co. on December 19. Shares of that company had grown 17,000% in three months, according to CNN money. Now many companies are flocking to do ICO s, a kind of IPO for companies based in cryptocurrency.

For years, Bitcoin was able to percolate in the shadows, with loyalists outside the mainstream. Now that it is being subjected to the spotlight there are no shortage of critics. Harvey Pitt, a former chairman of the SEC, told CNBC that "we're in line for some serious regulatory responses to all of this and that will be forthcoming after the first of the year." Brad Garlinghouse, CEO of Ripple, told CNN Money that "many of the ICO s are more frauds than real businesses. The industry needs to work with regulators and not be in the shadows."

The pushback against these currencies is not just about regulation. There is also a major push by insiders to whisper news stories to media and spread misinformation about BitCoin. Terrorism, bubbles and mass environmental disaster laying waste the world are just some of the click-bait stories. For instance Wired magazine asked in early December, "If running the bitcoin network uses up as much yearly electricity as a medium-sized country, is it worth it?" The article notes "it's nigh on impossible to know exactly how much energy is being used."

Wait, so then why the sub-head claiming that it uses as much as a whole country? The article admitted that the range for energy use was between 100MW and 3.4GW. Relying on the same source at "Digiconomist," the website claimed that Bitcoin's total annual energy consumption is 29.05 TWh, which "is the equivalent of .13% of the entire world's annual energy consumption, and that is more than the individual energy consumption of 159 of the world's countries."

That sounds like a lot. But, like Wired, admitted that actually, "no one knows for sure."

If BitCoin "mining" was really taking up so much electricity, wouldn't we see a massive energy spike in countries where these processors are based, such as China? Another criticism found online is that Bitcoin or blockchain technology isn't nearly as good as existing systems.

"In the end the advantage of the existing human and software systems surrounding transactions... outweigh the purported benefits as well as the hidden costs," writes Kai Stinchcombe at

This is an argument in favor of using credit cards or online payment systems that already exist.

Banks, credit cards and the international monetary system have an interest in casting aspersions on digital currency. It's the same aspersions that were used to critique manufacturing leaving Western countries for China, or the same ones that were used to cast doubt on online shopping, or Uber or basically anything that is new. Major airlines don't like discount airlines. Legacy media doesn't like new media. Local tax authorities don't like large Internet companies whose sales they can't tax.

The prophets of the cryptocurrency world have a different imagination. They think that these coins can solve many problems.

You can find articles online proposing digital currency as a solution to problems for stateless people, such as Palestinians or Kurds, as a way to bypass borders. Russia, for instance, reversed course on cryptocurrencies, initially cracking down on them and then "going all in," according to an article at Vice. "Theories range from Russia making a strategic decision to reduce its economy's reliance on oil and gas through bullish crypotcurrency investment to Russian oligarchs looking for clever ways to avoid western sanctions," the article claims.

In the end, the old-style financial markets want to get in on the action as well. Bitcoin futures started trading in December. This derivatives market around Bitcoin is a good way for investors who don't want the exposure of owning the digital currency to profit.

For investors it can also mean investing in companies that are testing the waters.

Although Bitcoin itself may be a bubble, the degree to which the world is looking into blockchain and cryptocurrencies illustrates that a new world is on the horizon.

How exactly that market will mature is unclear. No one could have predicted what would follow when the first email was sent in 1971. Similarly when new websites such as SnapChat or Twitter first rolled out people mocked them as impractical. In the words of Brexit prophet Nigel Farage, "who's laughing now?"

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Bitcoin fraud could be the next big thing for swindlers in Israel

By Andrew TobinDecember 21, 2017 5:01pm

A visual representation of the digital cryptocurrency Bitcoin. (Dan Kitwood/Getty Images)

TEL AVIV (JTA) — Israelis lined up Tuesday afternoon at the newly opened bitcoin exchange in this city to purchase the coveted cryptocurrency.

Amid the store's yellow signage, the customers one by one inserted bank cards into a towering ATM-like machine. Sharply dressed young employees helped them make the necessary online maneuvers to claim their new funds.

Guy Maimon, a goateed 22-year-old, sat at a desk in the corner of the Bitcoin Change store buying cryptocurrencies from foreign markets in a desperate effort to keep the kiosk stocked. He said every day was like this, with hundreds of customers coming in a week. The company has had to limit individual purchases to 5,000 shekels, or about $1,400 a day.

"The demand is crazy," Maimon said as he toggled between tabs on his laptop and worked his leg muscles with an exercise band. "A lot of people return every day and buy the maximum. When we run out and turn off the machine, people sit here and wait for us to turn it back on."

Interest in cryptocurrencies has surged not just in Israel, where banks make them hard to buy from exchanges, but around the world. As of Wednesday, a single bitcoin, the most popular digital currency, was worth $16,000 compared to just $1,000 at the beginning of the year and $10 in 2013.

But as with any bubble, fraudsters have begun to take advantage of a cryptocurrency bonanza with a variety of nefarious schemes. According to fraud experts, Israel is shaping up to be a hub for cryptocurrency swindling.

It has happened before. Over the past decade, more than 100 "binary options" companies set up shop in Israel, forming the core of a global industry offering dubious all-or-nothing bets on various assets. The companies bilked people worldwide out of billions of dollars. In August, Israel Police Superintendent Gabi Biton told a Knesset panel that the industry was run by — and provided "massive enrichment" to — Israeli crime bosses.

As the result of dogged reporting by The Times of Israel, the Knesset in October banned binary options companies from operating in the country. And in the first half of the year, deposits fell 78 percent, according to an industry benchmark. However, the Knesset bill that covered various types of financial fraud was narrowed to apply only to binary options, raising concerns that fake binary options companies will simply switch to another product and continue to operate.

Shortly after the passage of the law, Israel Securities Authority Chairman Shmuel Hausner told The Times of Israel that he was "very troubled" by the possibility that binary options cheats would turn cryptocurrencies into the next big scam.

"We don't want this to become the next mutation of binary options or a haven for fraudsters," he said.

Echoing Biton, Hausner expressed confidence that the law could be extended to binary options scammers who sell other products. But he said schemes not covered by securities laws could fall outside his jurisdiction and under that of the police.

Austin Smith, the founder of Wealth Recovery International, a Tel Aviv startup that helps victims of binary options fraud reclaim their money, warned that the worst fears of the authorities are coming to pass. He said the same factors that earn Israel the "startup nation" moniker also make it a breeding ground for fraudsters: its small size, innovation and technology, seize-the-day mentality and diverse immigrant population that can market in myriad languages.

Based on his company's investigations, which have included sending moles into the offices of scammers, Smith has concluded that Israel is seeing an industrywide shift into cryptocurrency.

Guy Maimon posing with his father outside the Tel Aviv bitcoin exchange where he just bought his first cryptocurrency, Dec. 19, 2017. (Andrew Tobin)

"More or less every binary options company we know of now has a cryptocurrency platform as well," he said. "I'm already getting calls from victims, but most people have yet to even realize they've been defrauded."

Smith said the cryptocurrency scams involve not only securities, but also initial coin offerings and futures. In each case, the fraudsters offer a bogus product in exchange for cryptocurrency and simply pocket much or all of the investment. Conveniently for criminals, who were among the first adopters of the technology, cryptocurrency's encryption and decentralized control system makes it nearly impossible to track.

Arthur VanDesande, a consultant for the Wolf Global consultancy who recently retired as a U.S. Internal Revenue Service special agent focused on international fraud, also predicted that Israeli binary options swindlers would spearhead a massive new cryptocurrency fraud akin to the binary options scam.

"These guys would have to be stupid not to make the switch," he said. "And they're not stupid."

VanDesande explained that small states like Israel generally lack the resources of world powers like the United States to do effective financial oversight and "understandably" tend not to prioritize cases that do not involve their own citizens. He said there are also incentives not to look too hard. Fraudulent industries are often major economic drivers, he noted, and that can translate into political clout.

"From my perspective as a former senior investigator, when there's so much money flowing into country, you would probably take a wild guess that it's going into campaign contributions," he said. "Maybe that's why it took so long for binary options to be shut down in your country."

Corruption in high places has been at the center of the national conversation in recent months. With Prime Minister Benjamin Netanyahu the subject of two police probes, thousands of Israelis have taken to the streets of Tel Aviv the past three Saturdays to protest government corruption and the so-called recommendations bill, which would prevent police from publicizing recommendations on indictments.

Speaking at the most recent rally, Eliad Shraga, the founder and chairman of the Movement for Quality Government in Israel, warned that Israel is becoming a "mafia" state. He adapted his speech in an English language blog post published Tuesday by The Times of Israel.

"These past few weeks have taught us that we are not speaking of a specific event, but about a foul tsunami rising up in an ocean of corruption that threatens to drown the state of Israel," he wrote. "This is organized crime; crime families and Israeli mafia who are gaining control of local government and from there gradually taking over the central government and the nerve centers of Israeli society."

For it's part, Bitcoin Exchange says its operation is entirely aboveboard and only makes money on commissions. Maimon, the cryptocurrency buyer, affirmed this was true. But he added that he was already making plans for the day after the cryptocurrency bubble bursts, including starting college in the fall.

"I'm not investing in bitcoin," he said. "I'm pretty sure it's going to blow up." Get JTA's Daily Briefing in your inbox

Syrian refugee baby rushed to Israel for emergency heart surgery

Cypriot Health Ministry begs Israel to help save life of day-old Syrian boy with congenital heart defect - Children's hospital deputy director: We aim to provide help in complicated cases from around the world - Baby in stable condition, awaiting surgery. Mati Tuchfeld and Maytal Yasur Beit-Or

The Syrian newborn is flown to Israel in a special neonatal incubator to receive life-saving surgery | Photo: Aviation Bridge

A baby boy born to Syrian refugees in Cyprus last week has been flown to Israel and hospitalized at the Sheba Medical Center at Tel Hashomer, where he is due to undergo surgery to correct a severe congenital heart defect.

On Friday, the Cypriot Health Ministry contacted Israeli Ambassador to Cyprus Sammy Revel and asked for his assistance in transferring the day-old baby to Israel for medical treatment.

The Israeli Foreign Ministry, along with defense and security officials and the Border Crossings Authority at Ben-Gurion International Airport, sent a joint appeal on the baby's behalf to Interior Minister Aryeh Deri, who issued permits for the baby and his father to enter Israel for the procedure.

Sheba Medical Center reported that the baby is hospitalized in the Neonatal Intensive Care Unit in stable condition and is expected to have the operation in the next few days.

Dr. Itai Pessach, deputy director of the Edmond and Lily Safra Children's Hospital at Sheba, said, "The baby is hospitalized in the NICU. His condition is stable, and he will be operated on at the International Congenital Heart Center at Sheba.

"Bringing the baby [to Israel] is part of the international work that Sheba spearheads and as part of which we established the Israel Center for Disaster Medicine and Humanitarian Response, which is designed to provide help in complicated cases from around the world. Thanks to close cooperation with the Foreign Ministry and many other officials, we have managed to bring in this baby too."

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News Brief
2-day-old Syrian refugee baby flown to Israel for life-saving surgery December 24, 2017 3:12pm

JERUSALEM (JTA) — A two-day-old baby born to Syrian refugee parents in Cyprus was flown to Israel to fix a severe heart defect.

The baby, who was born in a refugee camp in Cyprus, was airlifted to Israel on Friday night for the life-saving operation at Sheba Medical Center in Tel HaShomer. He arrived with his father.

Israel was alerted to the baby's need after the Cypriot Health Ministry contacted Israeli Ambassador to Cyprus Sammy Revel and asked that the baby be allowed to enter Israel and receive treatment. The Foreign Ministry then asked Interior Minister Aryeh Deri for permission to allow the baby and his father to enter Israel.

The baby is expected to undergo surgery on Monday. Following the surgery, the baby will have to remain under observation for a "period of time," according to the hospital.

"Praying for a full and quick recovery," the foreign affairs ministry said in a tweet. Get JTA's Daily Briefing in your inbox

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