POSTVILLE, Iowa --- Charities that received millions of dollars in donations from Agriprocessors before it declared bankruptcy are paying some of the money back.
On Wednesday, the trustee handling the now-defunct kosher meatpacker's Chapter 7 case announced a settlement with Colel Chabad, the longest-running charity in Israel.
Colel Chabad received more than $4 million from Agriprocessors in the two years before the company's bankruptcy, according to court records. The trustee said the company received nothing of value for the money --- which included 64 payments ranging between $1,445 and $200,000 --- and the payments were made when Agriprocessors was insolvent.
The trustee made the claim seeking repayment in November 2011, and the charity raised defenses that the trustee said would make it unlikely the trustee would recover a signification part of the money through litigation.
On Wednesday, the trustee filed papers stating two sides agreed to a $50,000 settlement.
The trustee said the agreement is in the best interest of the estate given the facts.
The settlement is pending court approval.
Colel Chabad is a nonprofit organization that runs soup kitchens and medical clinics and offers services to widows and orphans. It also has an immigrant aid program.
In December, the trustee announced a settlement with the charity Bet Kahila-Eighth Degree for $82,000. The organization had received $2.89 million from Agriprocessors.
The trustee is also seeking repayment from other charities, including the Torah Education Program of Northeast Iowa, which allegedly received $11 million, court records state.
Agriprocessors filed for bankruptcy in 2008 following an immigration raid. Former company vice president Sholom Rubashkin is currently serving time for federal financial charges.
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