How US Tax Breaks Fund Israeli Settlers

Peace Group Targets Settlements' Charitable Status

Israeli peace activists are planning to ratchet up their campaign against groups in the United States that raise money for settlers by highlighting how tax exemptions are helping to fund the expansion of illegal settlements in the West Bank.

Gush Shalom, a small peace group that advocates Israel’s withdrawal from the occupied territories, is preparing to send details to the US tax authorities questioning the charitable status of several organisations.

Adam Keller, a spokesman, said these operations’ tax-exempt status meant that “settlement expansion is effectively being subsidised out of the pockets of the US taxpayer and government”.

The campaign is designed to increase pressure on Barack Obama, the US president, to demand action from Israel on his repeated calls — so far largely ignored — to end settlement building. Last week, Israel announced plans to build 455 new homes in West Bank settlements and 500 apartments in East Jerusalem.

Mr Obama is expected to unveil a Middle East peace plan this month.

In a related move, Gush Shalom is encouraging Palestinians who have suffered from settler violence to file lawsuits in the United States that would redefine the settlers’ fund-raising work as support for “terrorist activity”.

The peace group has accelerated the pace of its campaign, according to a “confidential memo” it issued on July 29 that was leaked to the Israeli media, after the Israeli government heavily criticised human rights groups over the summer for receiving funds from foreign donors, particularly European governments.

In particular, the foreign ministry lambasted Breaking the Silence, a group of army veterans, for publishing testimonials from 26 Israeli combat soldiers suggesting the army committed war crimes during its assault on Gaza last winter.

Mr Keller said: “It’s the height of chutzpah for the foreign ministry to be hounding Breaking the Silence, which is doing something entirely legal and transparent, while keeping quiet about the settler organisations’ dependence on foreign income for their illegal activities.”

Gush Shalom said it was not divulging details of the organisations it will target next month to ensure an element of surprise. But Mr Keller said all of the 120 main settlements, which are illegal under international law, benefit from fundraising operations in the US.

Gush Shalom has already accused one organisation, Shuva Israel, which is registered as a charity in Austin, Texas, of channelling funds to the Shomron Liaison Office, located in the West Bank settlement of Revava, south of the Palestinian city of Nablus.

According to Shuva Israel’s website, donations are used to support several outposts close to Revava, such as El Matan, Havat Gilad and Havat Yair, which are illegal under Israeli law.

The 100 or so outposts, satellites of the main settlements, have been the settlers’ most effective method of extending their control over Palestinian territory in the West Bank. Israel has repeatedly promised the United States it will dismantle the outposts — so far to no effect.

Shuva Israel also funds Yitzhar, a settlement that hit the headlines last year when its inhabitants rampaged through the neighbouring Palestinian village of Asira al Kibliyeh in what the prime minister at the time, Ehud Olmert, called a “pogrom”.

Referring to Shuva Israel and the Shomron Liaison Office, Mr Keller said: “From our investigations it is unclear whether these are actually two organisations with close links or two faces of the same organisation.”

David Halevy, the head of Shuva Israel, told the Jerusalem Post that donations subsidised projects in West Bank settlements and outposts such as schools, libraries, youth centres and empowerment training for women.

Mr Keller said most of the organisations were quite open about their fundraising activities, but that donations in support of the settlements almost certainly broke the terms of the US tax-exemption laws.

“On the public relations side they say they are involved in humanitarian and non-political work, but to their supporters they play up their assistance for the settlers’ nationalist and expansionist activities. This is the way we hope to catch them out.”

A recent report by the International Crisis Group (ICG), a group of academics and former diplomats, identified several other settler organisations fund-raising in the United States.

It noted that the settlement of Sussya in the South Hebron Hills raised funds through a tax-exempt US organisation called PEF Israel Endowment Funds, registered in Manhattan. In 2007, Forbes, the business magazine, ranked PEF as one of the 200 largest charities in the US.

Other US tax-exempt charities named were the One Israel Fund, which raises money for projects in outposts, and the Hebron Fund, which raises an average of $1.5 million a year on behalf of a few hundred extremist Jewish settlers encamped in the middle of Hebron.

The One Israel Fund claims on its website to be “the largest North American charity whose efforts are dedicated solely to the citizens and communities of Yesha”, a Hebrew acronym for the West Bank.

According to the ICG report, Christian Zionist groups also raise significant sums for the settlements. One website, Christian Friends of Israeli Communities, lists dozens of youth and community projects in the settlements it funds.

An investigation last month by the Israeli daily newspaper Haaretz revealed that a group called American Friends of Ateret Cohanim had received tax-exempt status by claiming to fund educational institutes in Israel. In reality, however, it had transferred $1.6m to Ateret Cohanim, an extremist settler group, which buys Palestinian land and homes in East Jerusalem, especially in the Muslim quarter of the Old City.

Gush Shalom also hopes to increase pressure on the funding of organisations by encouraging civil litigation in the United States from Palestinian victims of settler violence in a bid to characterise the attacks as “terror activity”.

Court rulings would then be sought to shut down the settlers’ US fund-raising arms on the grounds that they support terrorism, in an echo of legal action by right-wing Jewish groups in the US against Muslim charities.

Two additional campaigns are mentioned in the memo.

In the coming months the group plans to highlight the links between the settlements and such large international Zionist organisations as the Jewish National Fund and the World Zionist Organisation.

The JNF funds Canada Park, established on three Palestinian villages in the West Bank, and the WZO is widely regarded as being implicated in the establishment of the outposts. In July the WZO announced that it would spend $5.5 million this year on agricultural projects for the settlers.

Gush Shalom also suggests exposing the Israeli government’s support for US lobby groups, such as Stand With Us and the Israel Project, that are engaged in what it calls “propaganda” on behalf of the settlements.

Jonathan Cook, based in Nazareth, Israel is a winner of the Martha Gellhorn Special Prize for Journalism. His latest books are Israel and the Clash of Civilisations: Iraq, Iran and the Plan to Remake the Middle East (Pluto Press) and Disappearing Palestine: Israel's Experiments in Human Despair (Zed Books). Read other articles by Jonathan, or visit Jonathan's website.

14 comments on this article so far ...

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  1. mary said on September 16th, 2009 at 12:56am #

    Your output from within the belly of the beast is prodigious.

    A cartoon. A freeze on settlements? What settlement freeze?

  2. sk said on September 16th, 2009 at 7:16am #

    In NY synagogue, Israeli settler leader calls for assassination of Abbas—and tax-deductible contributions.

  3. B99 said on September 16th, 2009 at 2:15pm #

    OK – not precisely a response to the above article – but related. Here are some Amnesty International’s findings on the Israeli assault on Gaza.


    The report’s findings are consistent with those of Amnesty International’s own field investigation into the 22-day conflict during which some 1,400 Palestinians and nine Israelis were killed (four other Israeli soldiers were killed by their own side in ‘friendly fire’ incidents).

    Most of the Palestinians killed by Israeli forces were unarmed civilians, including some 300 children. Amnesty’s investigations also found Israeli forces carried out wanton and wholesale destruction in Gaza, leaving entire neighborhoods in ruin, and used Palestinians as human shields. Amnesty’s findings also agree with the Goldstone report in that the rocket fire into southern Israel by armed Palestinian groups, including Hamas, was indiscriminate which constitutes a war crime.

    Key findings of the Goldstone report include:

    • Israeli forces committed violations of human rights and international humanitarian law amounting to war crimes and some possibly amounting to crimes against humanity. Notably, investigations into numerous instances of lethal attacks on civilians and civilian objects revealed that the attacks were intentional, that some were launched with the intention of spreading terror among the civilian population and with no justifiable military objective and that Israeli forces used Palestinian civilians as human shields.

    • Israeli forces committed grave breaches of the Fourth Geneva Convention, notably wilful killing, torture and inhumane treatment, wilfully causing great suffering or serious injury to body or health, and extensive destruction of property, not justified by military necessity and carried out unlawfully and wantonly. As grave breaches these acts give rise to individual criminal responsibility.

    • Israel violated its duty to respect the right of Gaza’s population to an adequate standard of living, including access to adequate food, water and housing. Notably acts which deprive Palestinians in Gaza of their means of sustenance, employment, housing and water, that deny their freedom of movement and their right to leave and enter their own country, that limit their access to an effective remedy and could amount to persecution – a crime against humanity.

    • Palestinian armed groups violated the principle of distinction by launching rocket and mortars attacks which cannot be aimed with sufficient precision at military targets and that their attacks into civilian areas which had no intended military target constituted deliberate attacks against civilians. Such attacks constitute war crimes and may amount to crimes against humanity.

    • Palestinian combatants did not always adequately distinguish themselves from he civilian population and they unnecessarily exposed civilians to danger when they launched attacks close to civilian or protected buildings.

    • The Fact-Finding Mission found no evidence that Palestinian armed groups directed civilians to areas where attacks were launched or that they forced civilians to remain within their vicinity, nor that hospital facilities were used by the Hamas de-facto administration or by Palestinian armed groups to shield military activities, or that ambulances were used to transport combatants, or that Palestinian armed groups engaged in combat activities from within hospitals or UN facilities that were used as shelters.

  4. Mulga Mumblebrain said on September 16th, 2009 at 9:16pm #

    B99, the Goldstone report is a travesty, as one would expect from a fervent Zionist. Just whose idea of a bad joke it was to appoint such a person to investigate Israeli crimes against human decency, God only knows. To equate the attempts of Hamas to defend themselves against neo-Nazi racists who proclaim that killing civilians is a ‘mitzvah’ or good deed, and who carefully planned their onslaught to coincide with the time that the Gazan streets were packed with school-children after classes, with the assaults of a major military power against defenceless, encaged civilians with nowhere to flee, is moral imbecility and viciousness of the deepest colour.
    Needless to say the Judaic Herrenvolk have refused to acknowledge their guilt as outlined in the report. They have launched their standard braying, ranting, racist torrent of abuse, of the hated UN, full of despised ‘two-legged animals’ who refuse to acknowledge Israel’s unique role as over and above goyish concerns. They are barking mad and evil, but just watch them pull the vicious moral cowards of the Western Governments into line, with threats and calling in of obligations. And the foul sewer of the Western media can be expected with absolute certainty to join in this racist crusade. Israel personifies Western racism, violence and savagery, and the other Western racists can be absolutely expected to rush to her aid, as ever, while mouthing odiously hypocritical lies about ‘morality’ and ‘human rights’.

  5. mary said on September 17th, 2009 at 12:08am #

    Richard Goldstone is on the Board of the Hebrew University His daughter who lives in Canada says that the report was softened by her father’s presence. Note this sentence in her reported remarks –
    “My father did not expect to see and hear what he saw and heard.”

    Haaretz Service – 16 Sept 2009

    Had Richard Goldstone not served as the head of the UN inquiry into the Gaza war, the accusations against Israel would have been harsher, Goldstone’s daughter, Nicole, said in an interview conducted in Hebrew with Army Radio on Wednesday.

    “My father took on this job because he thought he is doing the best thing for peace, for everyone, and also for Israel,” Nicole Goldstone told Army Radio.

    She added that her father wrestled with the decision to take on the task. “It wasn’t easy [for him],” Nicole Goldstone said. “My father did not expect to see and hear what he saw and heard.”

    Nicole Goldstone, who currently lives in Canada with her family, spoke of her great love for Israel.

    “Every time I dream of returning to the country or that my son will one day immigrate there,” she told Army Radio.

    “Israel is more important to me than anything. I’m not there at the moment, but my heart is always there.”

    Nicole Goldstone said she expects to host her father for the upcoming Rosh Hashanah holiday.

    Besides the report’s overwhelming conclusion
    of Israeli war crimes and recommendations to
    the Security Council that they be referred
    to the International Criminal Court, there’s
    also this little awkward instruction to
    individual states:

    “1772. To the international community
    The Mission recommends that States Parties
    to the Geneva Conventions of 1949 start
    criminal investigations in national courts,
    using universal jurisdiction, where there is
    sufficient evidence of the commission of
    grave breaches of the Geneva Conventions of
    1949. Where so warranted following
    investigation, alleged perpetrators should
    be arrested and prosecuted in accordance with
    internationally recognised standards of

  6. Mulga Mumblebrain said on September 17th, 2009 at 1:11am #

    mary, thanks. It doesn’t come much more blatant. Not that his work to protect Israel will protect Goldstone from denunciation as a ‘self-hating Jew’. I imagine it must be a depressing reality for those basically decent Jews who still exist, that their beloved state and most of their co-religionists have gone over to the side of open racism, fascism and absolute hatred and contempt for non-Jews, including the collaborationists who serve Israel’s purposes. I believe that there must be many Jews who do not ascribe to the doctrines of absolute supremacism of Jews over the rest of humanity so readily manifest by Israeli atrocities, but to turn against this fundamentalist clerico-fascist doctrine entails cutting yourself off from your community. This involves real courage, and the majority clearly prefer to hunker down into paranoid phantasies of undying Gentile hatred and fearful delusions of new Holocausts, just around the corner if such and such a country is not obliterated and its people slaughtered. My own aunt, a relatively integrated Jew, hardly observant and without any delusions of supremacy that I could ever discern, has become a raving Zionist with the advancing years, absolutely inimical to justice for the Palestinians and driven to hysterical distraction by fears of ‘terrorism’ and Islamofascism. She simply denies Palestinian suffering, which is completely unlike her former self. It seems that Zionism is a spiritual poison, like apartheid and ‘yankee exceptionalism’ that drives once decent people mad.

  7. MEBOSA RITCHIE said on September 17th, 2009 at 4:02am #

    My own aunt, a relatively integrated Jew

    your aunt seems a very reasonable woman who has gained wisdom with advancing years
    i hope mugla,you will achieve the same wisdom as you get older
    i didn’t know you were jewish
    shana tova

  8. bozhidar balkas vancouver said on September 17th, 2009 at 5:52am #

    As was noted by many observers, US-financed ‘settling’ of aliens on pal’n soil cld have been prevented or eventually stopped only by war.
    ‘Settling’ people from all over the world on land that is morally and legally pal’n is an act of war; probably done in order to provoke an attack by arab lands.
    But arabs never bit. They knew that attacking israel means attacking US. They surely wld have lost more land and got more expellees; euphemestically called “refugees”
    In order that americans think the same way ab. pal’n and katrina refugees.

    In ’67 Israel waged war for the rest of palestine; oops, ‘jewish’ historical lands, in order to possess it.
    The conquest can only be annulled by another war.
    So, why all these peace orgs, peace process? Is it a show or a sharade for americans and other christians? A feelgood thing? Or foisting the notion how hard US/Israel is working to find the solution? I think so!
    We also have a few individuals here on DV who engage in this charade; dissembling how much they care for the wellbeing for pal’ns by offering them a ‘state’ o ftheir own.
    And they rage, hate, call names people who come up with facts that show palestine may not ever rise and which they actually wish for.
    They do not fool me!

  9. MEBOSA RITCHIE said on September 17th, 2009 at 6:01am #

    you can’t fool bozh.
    he’s too clever;you can tell by his postings that he is very clever

  10. b99 said on September 17th, 2009 at 11:00am #

    The irony is that the Goldstone Report his damning of Israel DESPITE coming from a Zionist soft on Israel.

    And with regard to Hamas human rights transgressions, the sum total of Israeli civilians killed in that ‘war’ by Hamas was zero. The sum total of Israeli civilians maimed was zero. The sum total of Israeli civilian’s nicked or suffering from hang nails was zero. The sum total of Israeli civilians within earshot of the war was zero. They could however see the sky light up in the distance as the IDF burned Palestinian children.

  11. mary said on September 18th, 2009 at 5:48am #

    ‘Jonathan Cook, a British freelance journalist (formerly of The Guardian and Observer), now living in Nazareth, dazzled us with his lucid and convincing discussion of a whole range of issues, among which were the usefulness of the Boycott against Israel (“it is something that we can do”), the deliberate planting of settlements in areas to control aquifers, the problems of bias in the media, money laundering in Israel, and the ‘peace industry’ headed by Shimon Peres. (We highly recommend his new book, Disappearing Palestine.)’

    From the Lajee newsletter.

  12. MEBOSA RITCHIE said on September 18th, 2009 at 6:56am #

    for mary more humanitarian news from israel

    Magen David Adom evacuated six injured Gazans from the Erez border crossing to a hospital in Israel on Friday.

    The six had been injured in a gas explosion in their home, MDA said.

  13. mary said on September 18th, 2009 at 8:03am #

    More inhmanity from the cruel Occupier making it even more difficult for any human in Gaza to get out for medical care, bereavement etc.

    News Release, For Immediate Release, Thursday, September 17, 2009 (

    Coordinator of Government Activities in the Territories Cuts Contact with Human Rights Organizations: Refuses to Handle Applications on Behalf of Gaza Residents

    • As of this week: Army officials will refuse to respond to applications from Israeli human rights organizations on behalf of Gaza residents, even in emergency humanitarian cases.
    • New, unilateral procedures negate Palestinians’ right to representation in proceedings challenging military decisions.
    • Gaza DCO boasts that it exists “for humanitarian reasons” and then closes the single option for representation open to those with humanitarian needs.
    • Decision represents another step in a systematic attempt to restrict the activities of human rights organizations in Israel.

    Thursday, September 17, 2009: A coalition of human rights groups led by Physicians for Human Rights – Israel, HaMoked: Center for the Defense of the Individual, and Gisha – Legal Center for Freedom of Movement today sent a letter to the Coordinator of Government Activities in the Territories, in response to a letter from the head of the Gaza District Coordination Office (DCO) notifying them of an immediate refusal to respond to their applications regarding Palestinian residents of the Gaza Strip.
    The head of the DCO informed the Israeli organizations that from now on, IDF officials will no longer provide replies and updates regarding their clients, and the organizations must contact a foreign, non-Israeli body – the Palestinian Civil Affairs Committee – with the request that it forward their application to the IDF.
    The organizations expressed concern that this refusal will seriously impede the work of Israeli human rights organizations – and that Gaza residents with urgent humanitarian needs will pay the price.
    Human rights organizations, which assist thousands of Palestinians seeking to exit or enter the Gaza Strip for various reasons, serve in many cases as the only option of representation available to residents. Since a Palestinian resident of the Gaza Strip cannot approach the Israeli authorities directly, and since the Gaza DCO is the only body authorized to grant applications, the sole avenue open to such residents hoping to receive a response or to expedite the handling of their applications is via human rights organizations: “Your refusal to respond to the appeals of human rights organizations and Israeli attorneys constitutes a grave humanitarian blow to the Palestinian residents of the Gaza Strip and their right to representation – those Palestinian residents towards whom your foremost duty is to take care of their welfare, relief and humanitarian needs,” the organizations wrote.
    The organizations stress that in many cases their activities have saved lives and resolved problems and that the obstruction of their activities is likely to have very grave implications. That is raised, for example, in the case of Mu’tasem Billah Abu-Mastfa, a nine-month-old baby suffering from severe congenital heart defects: He has four holes in his heart, which is located on the right side of his chest. The baby is being treated on an ongoing basis at the El-Nasser Hospital in Gaza but due to a deterioration of his condition, his doctors referred him for treatment at Sheba Hospital at Tel Hashomer, Israel, where he was expected on September 13, 2009. On August 28, 2009, his family submitted an application to the Israeli-run Gaza DCO, via the Palestinian Civil Affairs Committee, to coordinate his exit from Gaza, but they have yet to receive a reply from the Gaza DCO, and therefore the baby has been prevented from traveling to receive medical treatment. Due to the IDF’s new policy of refusing to respond to applications made by human rights organizations, there is no way of finding out the reason for the delay or to expedite the handling of this urgent application. This is only one example of many.
    The Palestinian Civil Affairs Committee has no power to issue permits or to allow passage, since the IDF controls Erez Crossing.
    The organizations expressed surprise at the notice of refusal in light of the Coordinator of Government Activities in the Territories’ declarations that part of the DCO’s function is to respond to applications from Israeli human rights organizations. Recently the head of the DCO, Col. Moshe Levi, made contact with one of the organizations to propose a meeting in order to improve its work with the DCO and stated that the DCO exists “for the humanitarian niche,” i.e. for the Palestinian residents of the Gaza Strip who have been subject to the closure for more than two years. Now, just two months later, Col. Levi sent this letter to notify the human rights organizations of the immediate severance of contacts.
    The organizations signing the letter are: Gisha, HaMoked, Physicians for Human Rights – Israel, Association for Civil Rights in Israel, Adalah, Public Committee Against Torture in Israel, Rabbis for Human Rights, Yesh Din.

  14. bozhidar balkas vancouver said on September 18th, 2009 at 8:18am #

    Anent the ‘mistake’ ashk’m made in ’48
    Here’s what chomsky in his detering democracy ’91, 92 on p. 56 has to say about huge error the ashkenazic war planners against pal’ns have perped in ’48:
    As for the pal’ns, US planners had no reason to doubt the assessment of israeli gov’t specialists in 1948 that the pal’n refugees wld either assimilate elsewhere or “wld be crushed“: “some of them wld die and most of them wld turn into human dust and the waste of society, and join the most impoverished classes in the arab countries“. Accordingly, there was no need to trouble oneself ab. them.
    The double quotes are NC`s.

    I also for some time; perhaps 10 or 20 yrs ago thought that the invaders miscalculated or victimised selves by own assessment of how low, cowardly`, and useless pal`ns really were then and are now.
    This is much akin to hitler`s thinking.

    However, NC is for just that; i.e., for pal`ns to remain in poverty, or denies their right to return to their former orchards, pastures, homes, towns.
    Note that NC and probably all `jews` call the expelees “refugees“ ; thus can compared to the new orleans refugees!
    This is not clever, Neither pal`ns nor i buy the obvious lie! tnx