Rabbi Accused of Trying to Extort Millions From Mysterious ‘Connecticut Hedge Fund’

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Photo: NYP

Milton Balkany, an influential Brooklyn rabbi, was arrested yesterday for trying to extort $4 million from a Connecticut hedge fund. Apparently, the rabbi went to lawyers for the firm and told them that he'd been counseling a prison inmate and former employee of the company, who told him that he conducted insider trades while working there. The rabbi then offered to keep the inmate quiet, in exchange for a $4 million donation to the school where he is dean, Bais Yaakov girls' school in Borough Park, and another Jewish school. The complaint doesn't name the hedge fund, but it does give us some clues.

From the Post:

Milton Balkany is accused of trying to blackmail the firm by saying that the feds were "thirsty" to nail its manager, but that he himself didn't want the manager hurt because they were "co-religionists."


Of course, just because a slew of recent news stories have suggested that the feds are interested in Connecticut-based hedge fund SAC Capital's Steve Cohen, and just because Steve Cohen happens to be Jewish, and just because the overly secret "don't mention the name of the firm" has SAC written all over it, doesn't necessarily mean the fund in question is SAC. It could be any of a number of hedge funds. But if in the future court filings the phrase "the rabbi then threatened to release embarrassing tapes of hedge-fund manager discussing his relationship on Spanglish talk shows" comes up, we'll know for sure that it is.

Rabbi Is Charged With Trying to Extort $4 Million From a Hedge Fund [NYT]
Rabbi busted in $3M extort [NYP]
CT Hedge Fund blackmailed for insider trading info [Greenwich Time]