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Yes, he takes your money, but there is some good to it. When you can later fight him, he has a 50% return on your money. If you deposit 20, he'll drop 30 when you loot him. I don't know what the upper limit is, but I know that investing 60 will net 90 when you fight him. I tried investing more, but it only gave 90 with each deposit.
Just started a new playthrough, and I'm gonna deposit 60 each day, to see if that makes a difference(since the day may or may not effect on some other things).
And It isn't just the Jew that gets comments on their nose, everyone does.