The Rise (and Fall?) of the Galbut Dynasty

Heat fans be likeDuring its first fifty five years, the convalescent home Hebrew Home for the Aged catered to “elderly Jewish people and war veterans” and had “nurtured a reputation for providing top-notch services to senior citizens of all denominations who can no longer take care of themselves.”

It then took nine years for the Galbut clan to run that reputation into the ground.

As reported in yesterday’s Broward Bulldog article, FBI probes whistleblower claim of $130 million scam; Plaza Health Network under scrutiny, Miami Beach attorney-slash-real estate developer, Russell Galbut, and his brother-in-law, Richard Zubkoff, joined the board of directors of Hebrew Homes in 1995.  A scant year later, Galbut took over as chairman of the board.  By 2007, Zubkoff was “hired as president and CEO.”  Since then, Galbut has also managed to stack the board with a guaranteed majority vote – four out of seven board members are “people with close ties to Galbut: his brother Abraham Galbut, his cousin Joan Brent, attorney Ben Rozsansky, who works full-time at Galbut’s company Crescent Heights, and chairman Ron Lowy.”

Russell Galbut is apparently used to getting what he wants.  With huge Miami Beach investments at stake (including his under-construction 17,000 square foot apartment on top of a South Beach parking garage), he generously contributes to the political campaigns of politicians who, once elected, would be in a position to return the favor to some of their most generous donors.

This strategy worked out well for Russell when he crossed paths with North Miami Beach EX-Mayor/Felony Defendant Myron Rosner.  When Myron was running for re-election in May of 2011, Russell donated a total of $10,000.00 to his campaign, both personally and through various companies he owns.  Myron lost that election, but Russell’s donation was money well spent.  When the Galbut Dynasty’s Mondrian Hotel appealed a $1.8 million dollar fee assessed by the City of Miami Beach, Myron was in the position to “repay” Russell by persuading enough of his fellow members on the Miami-Dade County Board of Rules and Appeals to rule 8-7 in favor of the Mondrian.  Of all the board meetings held in 2011, the only two Myron attended were those in which the Mondrian appeal was on the Agenda.

As usual, I immediately filed a complaint against Myron with Joe Centorino’s Miami-Dade Commission on Ethics and Public Trust for his accepting campaign donations allegedly in exchange for political favors.  However, as I reported a year later on August 16, 2012, Let ‘Em Go Joe gave Myron yet another pass.  I noted, “The July, 2012 Meeting Summary of the Commission on Ethics reported:

“A complaint (C 12-30) filed against former North Miami Beach Mayor Myron Rosner in connection with his membership on the Miami-Dade County Board of Rules and Appeals was found Not Legally Sufficient and dismissed.  A citizen alleged that while he was running for re-election in 2011, Mayor Rosner accepted campaign contributions totaling more than $10,000 from developer Russell Galbut, his family members and various corporations in which he has financial interests.   While he lost the re-election bid, Rosner continued serving on the Board of Rules and Appeals and voted in favor of Galbut at two meetings of that board.  The County ethics code permits elected officials who are also members of quasi-judicial boards to vote on matters related to campaign contributors as long as the member will not personally profit or be enhanced by the vote.”

In Joe Centorino’s warped version of “ethics and public trust,” a board member’s acceptance of campaign donations in order to win an election does not constitute his being “enhanced” by voting in favor of his campaign donor.

Yeah, go figure.

One month and four days later on September 20, 2012, Myron was arrested on four felonies and five misdemeanors.  In a Press Release issued by State Attorney Katherine Fernandez Rundle, Joe Centorino didn’t hesitate to take credit for the “teamwork among the three offices involved.”

No credit was given to Team Irony.

Dear LordMyron may not be Russell Galbut’s useful idiot anymore, but there are more than enough politicians with their hands out for donations.  As Broward Bulldog reporter Francisco Alvarado pointed out, Galbut “is a big political contributor. In 2013, he and his companies gave $6,000 to a political action committee supporting Mayor Phillip Levine and two other city commissioners. Election records also show that Galbut and his companies also donated $113,750 to various Republican congressional candidates in 2008, 2010, 2012, and the recent midterm election.”

That might be chump change to someone who’s made millions upon millions of dollars on projects in Miami Beach alone, not to mention the income from Plaza Health Network, with its eight locations in Miami Beach, North Miami, North Miami Beach and Miami.

But if the FBI’s investigation into the company’s alleged theft of $130 million from the federal government leads to indictments, Russell Galbut may find himself donating to lawyers instead of politicians.

Alexis CarringtonWhile he has personally not had a brush with the law, Russell Galbut is hardly a stranger to the criminal element.

His former law partner, Alex Daoud, was convicted of felony bribery and served an eighteen month sentence … a few years after he served on the Miami Beach City Commission as Mayor.

Another shady character revolving around Planet Russell is one Herman Epstein, a convicted felon from New Jersey, who runs the physical therapy program at Plaza Health Network.  This is “an employee with no medical background and no physical therapy certifications, but a 1999 securities fraud conviction,” according to the Bulldog article.  “The criminal case stemmed from Epstein’s participation in a New Jersey boiler room operation that targeted elderly victims.  According to the lawsuit, Epstein’s job at Plaza Health was to fabricate and inflate the number of hours that Medicaid and Medicare patients supposedly received physical therapy. Between 2008 and 2011, the company billed the government programs for $130 million in bogus physical therapy services, the [whistleblower] complaint alleges.”

It’s important to note here that just because his former employee filed a whistleblower lawsuit against his company, it doesn’t prove that any crimes have been committed.

Yet.

Just because his former law partner, his employee, and his buddy on the Miami-Dade County Board of Rules and Appeals (that’d be Myron) are all either convicted felons or currently standing trial on felony charges, it doesn’t mean that Russell is guilty of anything.

Yet.

And just because “FBI agents raided Plaza Health’s Aventura corporate office and two of its nursing homes … carting off computers and boxes of patient records for several days,” it doesn’t mean that any arrests will be made.

Yet.

But there are two things I do know…

  • Water seeks its own level.
  • The Feds don’t screw around.

Say duck dynastyRussell Galbut is a major player in South Florida politics and real estate development, both of which have a tendency to attract individuals with questionable ethics. Because of his ties to North Miami Beach’s disgraced EX-Mayor Myron Rosner, he’s been on my radar since 2011.

With two of his Plaza Health Network rehab centers located in North Miami and one in North Miami Beach, which is also its corporate headquarters, Russell Galbut has now been added to my “Watch List.”

Just for sport.

Stephanie Kienzle
“Spreading the Wealth”

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35 Comments

  1. J. Lopez says:

    By the time the State Attorney’s Office gets around to prosecuting Myron Rosner all the witnesses in that case will have passed away, lose their wits based on advanced age or moved out west and are no longer reachable. The true reason this case is taking so long to be tried has to do with that little association between Rosner and Al Lorenzo- Katherine Fernandez Rundle’s campaign manager and absentee ballot collector. This is another example of the corruption that goes on at the SAO where Rundle and her bat boy Jose Arrojo rule supreme.

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  2. Ronald lowy says:

    I usually refrain from commenting on mud-raking articles of this sort but I feel compelled to defend the well-earned reputation of the Galbut family. As a board member of the Plaza Health Network, I am uniquely familiar with the workings of the Plaza and must point out that the innuendos of the article are not accurate. First of all, the Plaza is a not-for-profit charitable board and Russell Galbut is not compensated for his services. The mere fact that a Plaza employee made crazy allegations, in hopes of getting Dr. Zubkoff fired so he can seek his Executive Director position (and a raise), does not warrant any conclusion of guilt absent evidence. What is noteworthy is that the Government sought and received all of the requested Plaza records more than a year ago and has not deemed it worthy of any indictment despite having more than sufficient time to investigate.

    This article also suggested that Galbut’s political contributions get Galbut what he wants. This is also ludicrous. Mr. Galbut contributes at every level of government, including the national level to promote candidates he prefers. I note that the article attempts to use a single example of an 8 to 7 vote to conclude that such contributions are made as a quid pro quo. Why didn’t your article also a reveal that even after contributing to Miami Beach Mayor Levine’s campaign, Levine later opposed Galbut’s proposed demolition of the closed South Shore Hospital (which is an eyesore at the entry to Miami Beach) to construct an incredible one-of-a-kind 50 story tower with a six story cascading waterfall which would have become a landmark and included a three acre public park!

    Russell Galbut, like his parents and grandparents, deserves accolades and recognition for his contributions, public service and love of this community. Russell has stood by this community during hard times when he risked his family’s savings rehabilitating dozens of Miami Beach buildings during the 80s when Miami Beach had a reputation as a delapidated place for poor elderly. As a matter of fact, The Plaza Health Network was expanded for the purpose of assuring that this community’s elderly could live out their years in five star nursing homes.

    Perhaps the author of this article will, in the future, consider writing an objective article about its “targets” and include reliable and irrefutable evidence of their achievements, not just the writer’s attacks and unsupported allegations. Then we might view such writings as journalism. I will not, however, hold my breath until that day comes since it seems highly unlikely.

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    1. Stephanie Kienzle says:

      Thank you for sharing. You are obviously mistaking me for a journalist. I’m flattered, but here’s the thing. I’m not a reporter. I’m a blogger. With an opinion. It’s my opinion that anyone who would donate ten thousand dollars to help EX-Mayor/Felony Defendant Myron Rosner get elected is either (a) crazy, (b) stupid, or (c) as corrupt as Myron. Since it is my opinion that Russell is neither crazy nor stupid, well, you get the picture.

      I notice you didn’t leave a comment on the Broward Bulldog article, which discussed the FBI’s raid of your facilities. I have no idea if the FBI will find evidence of wrongdoing once their investigation is completed. But, I am certainly not surprised by your dismissal of the whistleblower’s complaints as “crazy allegations.” However, are you sure the FBI’s investigation is closed? After all, it took the State Attorney’s office more than two years to arrest Myron once the Miami-Dade County Public Corruption Unit started its investigation. The charges against Myron amounted to grand theft of approximately $20,000.00 from a city vendor. That’s a far cry from the $130 million that Plaza Health Network is allegedly accused of stealing from the federal government. With that much money at stake, I’m betting the FBI’s investigation will be pretty damn thorough.

      If you and your fellow board members honestly believe that you’ve done nothing wrong, then my opinion shouldn’t concern you in the least. I certainly don’t lose sleep worrying about your opinion of me.

      Then again, I’m not under investigation by the FBI. Just saying.

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  3. Anonymous says:

    Stephanie Kienzle,

    Your misinformed and outrageously uneducated attempt at writing a blog in order to achieve some attention will only discredit you and your lack of writing abilities. Your uneducated views on how the world actually works makes this article nothing short of laughable. Your failed attack on a brilliant, fair and most importantly caring human being is just a show of your weak character. Make an attempt to do research prior to spewing your insanely one sided thoughts out to the world. Fortunately, the world does not care the least bit about your opinion and the fourteen people (if you’re lucky) that read this will have found some great toilet humor!
    So thank you once again for your failed attempt at a blog post and I wish you a more patient and well thought out try for your next one.

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    1. Stephanie Kienzle says:

      I’m so glad I was able to help you feel better about yourself by putting me down. Thank you for sharing.

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    2. Stephanie Kienzle says:

      Just checking in to let you know that this column has received 1,049 hits to date. I think that’s a lot more than the fourteen you predicted. Obviously, you underestimated me.

      Just saying, of course.

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    3. Stephanie Kienzle says:

      In case you’re still following the comments on this blog, I thought I’d update you. The hit count so far is over 1,400. You either slightly underestimated my readership, or you meant to say “fourteen hundred” instead of “fourteen.” Here’s a tip: Don’t try your luck in Vegas. You obviously don’t understand odds.

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    4. Stephanie Kienzle says:

      “For the record, not only did slightly more than “fourteen people” read this blog, but it is the SECOND MOST READ COLUMN in the history of VotersOpinion.com. At press time, The Rise (and Fall?) of the Galbut Dynasty, has received 1,951 1,990 2,024 2,465 hits. (08/11/15 6:46 pm)”

      As posted in: http://www.votersopinion.com/2015/06/16/ronald-lowys-awkward-moment-in-3-2-1/

      Guess you were wrong, Anonymous. Just saying. 🙂

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  4. Stephanie Kienzle says:

    Francisco Alvarado’s article was just published in the Herald (http://www.miamiherald.com/news/local/community/miami-dade/article4082187.html). I don’t see any of Russell’s water carriers having the cojones to post a comment criticizing the reporter. I guess it’s okay for a man to have an opinion. But if a woman tries it, she has “weak character.”

    The 219 people who have read this blog so far obviously disagree with my two newest “fans.”

    #AchingSides

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  5. Stockholm Syndrome says... says:

    The fierce, blind defense of this bully seems to be based on fear rather than love. Or maybe their fear evolved into love?

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    1. Stephanie Kienzle says:

      All bullies have their loyal lapdogs. It’s their job to control the narrative and silence the critics. It’s their only reason for living. I don’t take it personally.

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  6. Stephanie Kienzle says:

    320 hits and counting.

    I guess more than “fourteen people (if you’re lucky) that read this will have found some great toilet humor!”

    VIVA LA TOILET!

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    1. Condo Owner says:

      You are right on target….do not be intimidated as the truth will come out.

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      1. Stephanie Kienzle says:

        No one ever intimidates me.

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  7. Stephanie Kienzle says:

    594 hits so far. Just saying.

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  8. mario lima says:

    Russell Galbut and all his people will join the fed club. It is time these people get exposed. They have been stealing money from the Gov and us the taxpayers for many years now. The Feds will find more than this in there investigation and the arrest will be a lot of well known people in the Miami Beach Community.

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  9. Stepnenie Cohen says:

    I hope the Government puts them in jail.I worked for these crooks for 12 years and I got fired when I asked to many questions myself. They must dig deep and they will find a big surprise. I am sure they already have the right person guiding them.Rusell is the head of the snake.

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  10. Stephanie Kienzle says:

    Hey, Anonymous: 691 hits so far. That’s a whole heck of a lot more than the 14 you predicted. Guess you underestimated me, huh? Perhaps you overestimated the “brilliant, fair and most importantly caring human being” you tried to defend. Apparently many others do not share your opinion.

    Just saying, of course.

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    1. LC Jacksol says:

      Who is anonymous…??! Mr. Sincojones..is that you? Please keep us updated Stephanie, so we can watch with glee as they go down…like the sewer rats that they are. Oh! And suddenly family members are being replaced at Shelborne Board HOA. They amended the bylaws so that now you don’t even need to be an owner to serve on the board. So now they have their family lawyers as board members

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  11. faith says:

    Hi Stephanie,Thank you for your blog and exposing these people. I watched them destroy a community on the UES of Manhattan terrible. They are throwing everyone out by not renewing their leases. Some of these people have lived there for 30 years plus. They are doing this so that they can build huge ugly, gaudy Condo’s Don’t let them intimidate you. Stay strong and keep reporting. Thank you.

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  12. Michelle Cours says:

    What about what the Galbut family did to all the people who owned condos in their condo hotels Shelborne, Mondrian and Hilton Bentley. After selling these condos many years ago to individual owners, Galbut decides to place unelected family members on the condo board, do large renovations not voted on by the owners, putting enormous assessments on the owners, funneling the assessment fees to other of Galbut’s projects, while forcing people out of their condos for not being able to pay these illegal assessments. Most of these people are middle class or retiries dependent on their rental income who thought they were making wise investments. Where is the concern and the justice for all these victims.

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  13. Skylar says:

    What is happening at the Bentley is unfortunate. The
    grandeur and charm is being stripped away by people who have no idea of historical integrity
    or respect for the Art Deco period. Everything needs to be updated and modernized but seasoned professionals should have a hand in the design choices and not someone who has no clue or respect for what has come before them. One of the reasons that South Beach has been popular in the past twenty years is the architecture and the gentle reworking of the past. I agree with the last post and am having the same experience with these people. No respect, decency or honesty. The truth will come out….water always seeks it own level…and precipitates sink to the bottom

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  14. Faith says:

    The NY AG is investigating them…stay tuned.

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    1. Stephanie Kienzle says:

      Very intriguing. Keep me posted! Thanks.

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    2. LC says:

      Faith, Where can we find out more about that? How did you know? And How can we get the FL AG to investigate…?!
      He’s not stopping. He’s using the money to build a mansion on top of a parking garage in South Beach. What is taking them so long to get this vermin…and all his cronies??
      He’s probably going to do business with Cuba. That will be an interesting show..to see which rat defecates harder on the other!LOL

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      1. Skylar says:

        Many owners at the Bentley can share their experiences in the same vein as the Shelbourne and Mondrian…not good. Hopefully the laws will prevail on the side of good and not evil. Being unscrupulous is not being a good business person or a good person no matter how much is presented in pseudo humanitarian causes. If anyone has similar experiences please let us know…we have much info to share also..

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  15. Anonymous says:

    While Mr. Lowy claims that Galbut is not compensated for his services, one should investigate the owners of the entities which own the nursing homes leased to and operated by Hebrew Home Health Network and who runs and benefits form Hebrew Homes Captive Services among other entities which are paid by hebrew Home Health Network or it’s various vendors.

    It is also the case that generally graft is funneled indirectly in a manner that is downstream from immediate ownership or employment and therefore difficult to identify. A claim of non-direct compensation therefore is hardly a conclusive defense.

    http://ethics.miamidade.gov/library/Inquiry2005/inq_05-163_galbut.pdf

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    1. Ron Lowy says:

      The Hebrew Homes are a charity with fully transparent finances and disclosures. The Hebrew Homes own five of its nursing homes while one is leased from a local religious institution. There is only one facility leased from a company partially owned by Galbut which is Plaza South and the rental paid for this property has been undisputed determined to be below market value by formal appraisal. As a matter of fact, the property should have been developed long ago as a hotel but the Galbut family has been most charitable in permitting the use of this property by our charity. Russell Galbut has also donated a million dollars to the nursing homes in one contribution alone evidencing his altruism and love for the charity’s work. Similarly, the Captive insurance entity to which you refer is also a charity and Russell Galbut receives no income whatsoever from that entity directly or indirectly. Abraham Galbut who manages the Captive does however receive a humble salary for his substantial time in managing the Captive insurer and defending all personal injury legal claims against the network.

      It is truly sad when people unfamiliar with the facts choose to make negative assertions rather than investigate the truth and facts. The Galbut family deserves our appreciation for the care given our elderly patients and for keeping this charity going even when they had to continually donate money back into the charity so it could survive lean times.

      Instead of attacking without knowledge of the truth, may I suggest you volunteer time, as I have, to the homes and come and see the work being done, the good deeds and heartfelt appreciation of our residents and be part of the solution rather than simply making problems. Despite my disagreement with your views, I would welcome you as a volunteer and you can learn the truth from the inside. Then, together we can help the residents which is the purpose of this charity.

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  16. Anonymous says:

    Mr. Lowy’s defenses again appear to consist of selective assertions and incomplete-truths that drip with a disingenuousness that begs more questions about why a criminal defense attorney is leading the Galbut’s public relations charge. Point-by-point:

    * While Mr. Lowy states that presently only one facility is partially owned by Galbut, the property and adjacencies on which the Hebrew Home of South Beach operated through 2013 was reportedly owned by Galbut’s main real estate holding company and sold earlier last year for $13.6 Million.

    * It has also been reported that other properties operated as Hebrew Homes were owned by Abraham Galbut and sold for $47.6 Million between 2007 and 2010 having been purchased in 1998 for $8.1 (reference linked below).

    * In light of these transactions, it certainly appears that in addition to serving the needs of the area’s aged community, the Health Network has served as an even more cost effective way for Galbut owned properties to wait out downturns in the real estate market by having ownership costs covered by rents until such time as the properties could be sold for sizable profits and/or otherwise redeveloped in to more profitable uses.

    * Mr. Lowy states the Abraham Galbut manages Hebrew Home’s captive insurer and defends all personal injury legal claims against the network “receive[s] a humble salary” for doing so. Does Mr. Galbut’s law practice and/or any affiliated law firm collect fees for defending such claims and/or doing other work on behalf of non-profit?

    * It is also the case that Abraham’s son Daniel Galbut is Hebrew Home’s Chief Operating Officer and Director of Operations.

    * Mr. Lowy, an attorney with no apparent specialty in non-profit administration, healthcare, or real estate joined Hebrew Home’s board and became it’s chairman shortly after the FBI investigation was first reported. Curious.

    http://www.floridabulldog.org/2015/02/embattled-nonprofit-plaza-health-network-sells-property-insider-pockets-millions/

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    1. Stephanie Kienzle says:

      Well, that article is quite interesting! Thanks for posting!!

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      1. Skylar says:

        Water will seek its own level. Keep working at
        it.

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  17. […] year I wrote a blog, The Rise (and Fall?) of the Galbut Dynasty, that rankled Mr. Lowy so much that he actually posted a comment, albeit with a caveat that he […]

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  18. […] the devil incarnate.  Anyone who says “NO” to real estate magnate/bully extraordinaire Russell Galbut is doing a great job in my […]

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  19. […] 2014, when I blogged about the FBI’s investigation of Galbut’s Plaza Health Network and the alleged theft of […]

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