7 arrested in alleged $14 million scam to steal funds targeted to New York yeshivas
(JTA) — A rabbi was among seven people arrested in connection with an alleged $14 million scam to steal funds earmarked for Orthodox yeshivas in New York state’s Rockland County.
The suspects arrested Wednesday afternoon are accused of requesting funding for Hasidic schools through a federal school technology funding program for underprivileged students, NBC New York first reported.
The internet is banned in the insular schools for which the funds were requested.
Those arrested, from heavily haredi Orthodox Monsey and the Satmar Hasidic village Kiryas Joel, allegedly bilked the E-Rate program funded by the Federal Communications Commission. They posed as consultants and vendors to obtain the funds, but never provided the funded services. The scam took place from 2010 to 2016.
NBC reported that in one case, over $500,000 in video conferencing equipment was ordered for a day care center serving 2- to 4-year olds.
“The suspects in this investigation allegedly used funding from a program designed to give underprivileged schools internet access to pad their own bank accounts,” NBC quoted William Sweeney, the FBI assistant director in charge of the case, as saying. “To add insult to injury, school officials, who see the day-to-day struggle to even find money for pencils and paper, were allegedly involved in the scheme.”