Gem Dealer Is Said to Aid Scheme on Terrorist Funds
By MICHAEL SLACKMAN
Yehuda Abraham is a slight, stooped 76-year-old gem dealer, with a house in Queens, an office in New York's diamond district and shops around the world.
One night last October, prosecutors say, a client entered Mr. Abraham's 12th-floor Midtown office and handed him $30,000 in hundred dollar bills, an odd, if believable transaction in the world of international gem dealers. Mr. Abraham, by the government's account, counted out every note, then gave the client his business card.
But this was not a jewelry sale, prosecutors allege. It was a secretive deal, with a code number and a cash commission, in which Mr. Abraham agreed to transfer the client's money to a bank account in Europe, out of the sight of federal regulators.
That transaction, if it occurred as federal prosecutors say, has landed Mr. Abraham, an immigrant who came to America nearly half a century ago, in the middle of an international dragnet that prosecutors said took into custody a dangerous arms dealer and his accomplices who were willing to bring missiles into the United States to shoot down passenger jetliners.
Prosecutors said in federal court yesterday that Mr. Abraham was the money man, a shadowy figure who facilitated the work of terrorists by giving them the means to finance their actions -- the purchase of the missiles -- through an informal money transfer system, known as hawala, which is common in the Middle East and a preferred method of finance for terrorists.
Mr. Abraham walked slowly into a federal courtroom in Manhattan yesterday, a curious figure described by some as an honest businessman and prominent member of the Jewish community in Rego Park. His rabbi showed up to offer moral support, and his brothers and sisters and children filled two aisles in the courtroom, as Mr. Abraham's lawyer, Larry Krantz, insisted this was a misunderstanding.
"I think there is a misconception to his role in this case," Mr. Krantz said.
Mr. Abraham, president of Ambuy Gem Corp., was arrested Tuesday by federal agents along with two other men -- Hemant Lakhani, a British citizen, and Moinudden Ahmed Hameed, of Malaysia.
Mr. Lakhani has been identified by prosecutors as an international arms dealer and charged with providing material support to terrorists as well as selling arms without a license. Prosecutors said he was trying to peddle shoulder-launch missiles to terrorists. Despite the prosecutors' claim that Mr. Abraham and Mr. Hameed aided Mr. Lakhani's terrorist dealings, the two have been charged only with conspiring to operate an unlicensed money transmitting business, a charge that at the most could mean five years in prison.
"Yes, this elderly gentleman in poor health significantly helped broker the sale of a surface to air missile," said Assistant U.S. Attorney Michael Purpura as he asked a judge to hold Mr. Abraham without bail.
But Federal Magistrate Judge Andrew J. Peck was not persuaded.
"I fail to see any allegation that could be read fairly proving or alleging that Mr. Abraham was providing money for weapons as opposed to any other black-market activity," Judge Peck said. He set bond and conditions of release pending trial, but stayed his decision until Mr. Abraham appears in court in Newark today.
Mr. Abraham has lived and worked for the last 40 years as a New York gem dealer, a career that has taken him as far away as Hong Kong and Saudi Arabia. Yesterday, men who worked with him for years on West 47th Street described him as a grandfather, an observant Jew and a well-known proprietor. Their reaction was one of disbelief.
"For a Jew to do something like that, I cannot believe it or understand it," said a 49-year-old jewelry wholesaler whose shop is on 47th Street. "He's a prominent member of our community. To do something like that is crazy."
The world of the diamond district, though, is a cash-rich one, where unset gems must often be purchased in cash, and where wealthy customers will often pay in bundles of bills. A law enforcement official said yesterday that behind the bustling facade of the diamond district is a nebulous world of murky financial transactions where federal agents have long focused on money laundering and other crimes.
Gem merchants acknowledged yesterday that large amounts of cash flow across international borders every day, but insisted that it is done in legal and documented ways.
"This business is very sensitive. People are very careful," the jewelry wholesaler said.
Mr. Abraham's relatives appeared stunned and angry as they left the court yesterday. They refused to comment, and the lawyer, Mr. Krantz, also refused to discuss Mr. Abraham's life, his work or the charges against him. In court, Mr. Krantz and the prosecutors described Mr. Abraham as a wealthy and successful man with more than $1 million equity in his home and shops in Europe, the Middle East and Asia.
But in court papers, prosecutors painted a more sinister picture of Mr. Abraham. The papers suggest that he was also involved in the hawala cash transfer system for some time and that he had a good reputation among those who used it.
In 2002, the prosecutors said, Mr. Lakhani, interested in proving his good faith with missile dealers overseas, enlisted Mr. Abraham to send $30,000 to a bank in Europe. He was described, in tape-recorded conversations with other participants, as trustworthy and well known. To ensure security of the deal, there would be a code. The person posing as a buyer of missiles -- actually a government co-operator -- was given the serial number of a one dollar bill. Later, the authorities say, after Mr. Abraham counted out the $100 bills in his office, he reached into his pocket and turned over a dollar bill with the exact serial number. The deal was complete, except for Mr. Abraham's fee of $1,500, prosecutors said.
Role of benevolent jewel dealer puzzles neighbors in New York
In his fancy Queens neighborhood, Yehuda H. Abraham is known as a kindly benefactor of his synagogue and world-traveling gem importer. The family business he co-founded in 1955 boasts of sales to royalty, heads of state, and a "highly discerning clientele in Saudi Arabia."
Along the chic, narrow streets of Hendon, in northern London, Hemant Lakhani is recalled as the owner of an empty million-dollar house.
In his temporary cell at the Passaic County Jail, Moinuddeen Ahmed Hameed remains a mystery: That he came from Malaysia three days ago is certain. Beyond that detail, nothing.
Prosecutors say they can prove that Lakhani, 68, a British citizen, was a "significant international arms dealer." They say they have evidence that Abraham, 76, and Hameed, whose age is unknown, were money launderers.
Lakhani's lawyer, Assistant Federal Public Defender Donald J. McCauley, declined to comment about his client after an appearance in federal court in Newark on Wednesday.
Hameed's lawyer, Cathy Fleming, said her client insists he did nothing wrong. Both men were being held without bond pending a bail hearing next week.
Abraham was accompanied in federal court in New York by his four children, a rabbi, and other supporters. His lawyer, Larry Krantz, said the charge does not specify that Abraham - who was arrested with Hameed at a Fifth Avenue gem dealership - knew he was involved in a terrorist plot. Bail was set at $10 million.
In his Forest Hills, Queens, neighborhood Wednesday, those who know Abraham said the scenario seemed all wrong. Nothing about the man, they said, suggested a plot to unleash a Russian-made missile, called an SA-18 Igla, on a nation of travelers still jittery about flying well after the Sept. 11, 2001, attacks.
No one answered the door to the grand brick two-story home at Ingram Street and 70th Avenue. The house, set on a corner property with a lush lawn and 6-foot hedges, is the finest on the block. Those who have seen the interior say it is outfitted with marble.
On the doorpost was a mezuza, a small case of parchment etched with biblical scripture that is often displayed outside Jewish homes.
Neighbor Bernie Roseman was among the half-dozen people who said Abraham was a good man, a benefactor of his synagogue who was kind enough to donate its torah.
"Unless the guy is out of his mind he couldn't have known what this [alleged plot] was all about," Roseman said. "I can't envision somebody who would donate a torah to be involved with terrorism."
Sylvia Hanna, a next-door neighbor of the Abrahams for 15 years, said she was not particularly social with the couple, nor did she see "anything to raise eyebrows."
"I didn't see them for months at a time," Hanna said. "The wife would tell me that they went to Thailand on business."
She added: "Why anyone who is Jewish would be mixed up with something like this is beyond me. But I'm an optimist. I think he'll be vindicated."
A business filing compiled by Dun & Bradstreet shows Abraham has been in the gem business since at least 1955, when he incorporated Ambuy International Corp. with an individual named Mayer Abraham.
The filing does not disclose the relationship, if any, between the Ambuy founders. A history of the company updated last month says Ambuy "wholesales jewelry or precious stones, specializing in jewelry and diamonds."
According to the filing, Ambuy employs 10 people, including Gideon Abraham - the son of Yehuda Abraham - as president. Ambuy sells to wholesalers and distributors in "local" territory, the document says, and rents 2,000 square feet of office space.
In the New York City diamond district Wednesday afternoon, many jewelers said Yehuda Abraham was a respected figure.
"As far as I know he was always full of integrity and honesty. I enjoyed dealing with him," said Steve, a 50-year-old man who declined to give his last name. On Tuesday, he said, police arrived at the Ambuy offices, 580 Fifth Ave. at 47th Street.
"I am in shock," he said. "I couldn't believe it."
No one answered the phone listed to Ambuy on Wednesday. On www.ambuy.com, a Web site riddled with spelling and punctuation errors, the company says it has jewelry designers in Europe and the United States and locations in New York, Antwerp, Milan, Bangkok, and Jiddah, which is in Saudi Arabia.
The site shows breathtaking precious stones, including a necklace set with 23.25 carats in emeralds and 61.60 carats in diamonds.
"We have sold to 7 Heads of State and Royal Families and our exquisite jewelry is much sought after by the affluent of the world," the site boasts. "Our store, New York Jewels in Jiddah located in the prestigious Sheraton Hotel has recently opened with the purpose of providing our highly discerning clientele in Saudi Arabia with the finest and most extravagant jewelry."
Gideon Abraham did not respond to an e-mail from The Record, and a phone message left at his home - a ninth-floor apartment at 257 Central Park West - was not returned.
Gideon Abraham's mother-in-law, a former Edgewater resident named Ann V. Karas, had little to say about Yehuda Abraham.
"I only know him as a nice man," Karas said from her home in East Hampton, N.Y. "We are related through marriage, distantly."
Yehuda Abraham is charged with conspiring to operate an unlicensed money transmitting business. He is believed to have handled a $30,000 payment on behalf of Lakhani, the British citizen, and have sent it to overseas accounts registered to Lakhani.
In England, police were continuing their investigation at two London locations, including Lakhani's house. He was arrested Tuesday night at a hotel near Newark Liberty International Airport and charged with attempting to provide material support and resources to terrorists and acting as an arms broker without a license.
On Wednesday a police officer stood guard at the door of Lakhani's two-story home in the exclusive north London neighborhood of Hendon, The Associated Press reported. Scratches appeared to be signs of where police had forced the lock, and the door had been secured again with two large padlocks.
A 15-year-old BMW sat in the driveway, and curtains were drawn in the windows of the duplex house. Neighbors told The Guardian newspaper that Lakhani was a textile dealer who had listed his home on the real estate market for $1.125 million.