US duty-free owners boost Israeli settlements

Since 2000, the Falics have given more than $1.7 million to pro-Israel politicians, both Democrats and Republicans, in the United States.
Thursday 04/07/2019
Controversial empire. Simon and Jana Falic pose for a picture at the Western Wall in Jerusalem's old city, last April. (AP)
Controversial empire. Simon and Jana Falic pose for a picture at the Western Wall in Jerusalem's old city, last April. (AP)

When travellers shop at duty-free stores at airports worldwide, they may be paying for more than a bottle of vodka or a box of chocolates.

The Falic family of Florida, owners of the Duty Free Americas shops, funds a controversial philanthropic empire in Israel that runs through the corridors of power and stretches deep into the occupied West Bank.

An Associated Press investigation determined that the family donated at least $5.6 million to settler groups in the West Bank and East Jerusalem in the past decade, funding synagogues, schools and social services along with far-right causes.

The Falics support the ultranationalist Jewish community in Hebron, whose members include followers of a rabbi banned from Israeli politics for his racist views. They back Jewish groups that covertly buy Palestinian properties in East Jerusalem and they helped fund an unauthorised settlement in the West Bank.

They have supported groups that push for the establishment of a Third Temple for Jews at the holiest and most contested site in the Holy Land. They have given more money than any other donor to Israeli Prime Minister Binyamin Netanyahu, a strong supporter of settlements, and have donated to other leaders of his Likud party.

The Falics' philanthropy also supports many mainstream causes, such as hospitals, athletics and helping the needy. However, they are a key example of how wealthy US donors bolster the contentious settlement movement.

Most of the world considers Jewish settlements in the West Bank and East Jerusalem to be obstacles to peace. The international community overwhelmingly says the settlements violate international law, which prohibits an occupying power from transferring its own population into territory it occupies.

However, Israel considers the territories "disputed" and says the fate of the settlements should be determined through negotiations.

In a response to questions through his lawyer, Simon Falic said Jews should be able to live anywhere in the Holy Land, whether it's Israel, Israeli-annexed East Jerusalem or the West Bank. He condemned violence and claimed none of the groups he supports do anything illegal under Israeli law.

"We are proud to support organisations that help promote Jewish life all over the Land of Israel," said Falic. "The idea that the mere existence of Jewish life in any geographical area is an impediment to peace makes no sense to us."

Since the capture of the West Bank and East Jerusalem in the 1967 Mideast war, the settler population has grown to about 700,000 people, approximately 10% of Israel's Jewish population. It received a boost from Netanyahu's pro-settler government and from a far more tolerant attitude by US President Donald Trump, whose top Mideast advisers are long-time settlement supporters.

An investigation of US tax forms by the Israeli daily Haaretz revealed that fundraising organisations in the United States raised more than $230 million for settlement causes from 2009-13. The Falics stand out for the wide scope of groups they support and their close ties to leading Israeli politicians.

The family has two main charitable organisations: the Falic Family Private Foundation in the United States and the Segal Foundation in Israel.

The Segal Foundation, operating since 2007, gave away approximately $15 million in its first decade. An analysis identified at least $5.6 million in donations to settlement and far-right causes. Funds also went to causes such as the country's amateur American football league, a Jerusalem hospital and a Jewish seminary in northern Israel.

Falic said the family's support for Jewish life "should not imply the exclusion of anyone else, including Christians and Muslims." However, critics say activities billed as harmless philanthropy have come at the expense of Palestinians.

"Everyone should be aware that, when they shop at Duty Free Americas, their dollars could potentially finance some of the most extreme right-wing actors in Israel," said Ran Cohen, founder of the Israeli Democratic Bloc, which aims to expose anti-democratic trends.

Duty Free Americas is headed by three Falic brothers: Simon, Jerome and Leon. The chain operates more than 180 stores at airports and border crossings in the United States and Latin America, the company website stated. Leon Falic told the trade publication TRBusiness that the privately held company last year posted more than $1.6 billion in sales.

Simon Falic said that, under Jewish tradition, it is customary to donate 10% of one's earnings to charity.

During the decade ending in 2017, they donated about $35 million, US and Israeli tax records indicate.

Simon Falic provided a detailed breakdown of the foundation's 2017 donations, much of which went to mainstream Jewish causes, such as WIZO, a women's organisation that operates scores of Israeli day-care centres, shelters and training programmes. They contribute generously in the United States to medical research, synagogues and Jewish schools.

Most of their donations in Israel do not appear in the forms. Money is also channelled through companies in Panama through the Segal Foundation.

Falic said the reason for this is not because Panama is a tax haven but because his brother Leon lives there and some of their companies have headquarters in Panama.

Falic described himself as a "big supporter" of Netanyahu, who has allowed Israeli settlements to flourish. Although Falic said he has not contributed to Netanyahu since 2014, collectively the Falics donated more than $100,000 to Netanyahu over the years, making them his biggest donors, Israeli public records indicate.

Since 2000, the Falics have given more than $1.7 million to pro-Israel politicians, both Democrats and Republicans, in the United States.

The Falics are prominent figures in Israeli right-wing circles. In April, Simon Falic mingled with the mayor of Jerusalem, Friedman and other dignitaries in the VIP section of a special Passover service at the Western Wall in Jerusalem.

Among the projects and investments the Falics have in the West Bank is the Psagot winery, an award-winning vintner that is a centrepiece of the settler tourism industry. The family has built a sprawling biblical theme park in the West Bank settlement of Shilo.

The Falics funded the construction of a synagogue and mikveh in 2014 in what was then the unauthorised West Bank outpost of Kerem Reim

"All of these donations were entirely legal," wrote Falic. "Any insinuation or allegation to the contrary is patently false and defamatory."

Israeli records show the Falics granted more than $100,000 to groups that seek the re-establishment of the Jewish Temple on a contested site in Jerusalem. Revered by Jews as the Temple Mount, that same area houses al-Aqsa Mosque, Islam's third-holiest site. The competing claims to the hilltop compound are a frequent flashpoint of violence.

Falic said the family is not involved in efforts to establish the Third Temple but he described Yehuda Glick, a former lawmaker and leading figure in the Third Temple movement, as a friend and said he finds it "ludicrous" that Jews cannot pray at their holiest site.

Perhaps the Falics' most controversial activity is in Hebron, a city where several hundred ultranationalist settlers live in heavily guarded enclaves amid some 200,000 Palestinians.

Relations between the populations are notoriously tense and some of the Jewish leaders are followers of the late Rabbi Meir Kahane, whose Kach party was outlawed in Israel in the 1980s for calling for mass expulsion of Arabs from the country.

Falic's associates in Hebron include Baruch Marzel, Kahane's former aide, who is a prominent political activist in Israel.

The Falics donated approximately $600,000 to Hachnasat Orchim Hebron, a group that hosts visitors to the Jewish community and provides snacks to Israeli soldiers protecting the settlers. Marzel's wife is one of the group's founders and Marzel is deeply involved.

They have given about $50,000 to the Fund for the Rescue of the People of Israel, which served as a fundraising arm of Lehava, a group that opposes Jewish-Arab couples in an anti-assimilation campaign and is accused of using intimidation or even violence.

Falic said he was not aware of any connection to Lehava and said the donations, made in 2011 and 2012, were to assist needy families. He noted that he opposes assimilation and intermarriage but also rejects violence. Israeli financial records show the fund has links to several Kahane disciples, including Marzel, who continues to call for mass expulsions of Arabs and has a history of clashes with police.

Falic said his connections with Marzel were primarily through a "beautiful project" that runs food trucks serving pizza, ice cream and snacks to Israeli soldiers protecting residents of Hebron.

"While I may not agree with everything he has said, the work we have done that has been affiliated with the Hebron community has been positive, non-controversial and enhances Jewish life in the Hebron area, which we strongly support," he said.

The family contributed more than $1 million to causes affiliated with Ateret Cohanim, which facilitates the sale of Palestinian properties in and around the Old City to Jewish settlers, an act of treason in Palestinian society.

Falic doesn't hide his support for what he called Ateret Cohanim's efforts "to bring Jewish life back to all of Jerusalem."

"It is unfortunate," he added, "that a Jewish family dedicated to this cause is newsworthy."