Williamsburg Yeshiva fined $8 million for stealing kids’ lunch money
WILLIAMSBURG — A Williamsburg yeshiva admitted in federal court on Monday that it was involved in a multi-million-dollar scheme to fraudulently obtain funds that were meant to feed school children.
The Central United Talmudic Academy admitted in front of U.S. District Court Judge Nicholas Garaufis that it committed wire fraud and stole money that was supposed to go towards meal programs for needy children.
The school has since been ordered to pay $5 million in penalties and an additional $3 million in restitution, which it has already paid, to make up for the fraud.
“The misconduct at CUTA was systemic and wide ranging, including stealing over $3 million allocated for schoolchildren in need of meals,” stated U.S. Attorney Breon Peace. “Today’s resolution accounts for CUTA’s involvement in those crimes and provides a path forward to repay and repair the damage done to the community, while also allowing CUTA to continue to provide education for children in the community.”
Elozer Porges, the former executive director of the yeshiva, and Joel Lowy, Porges’ assistant, both pleaded guilty in March 2018 for their roles in the scheme. Porges was sentenced to two-years in prison in October 2018 and Lowy was sentenced to five years’ probation, 1,000 hours of community service, and had to pay back $98,407.21 in April 2022.
The school was able to scam nearly $3.2 million in reimbursements for a meal program that never existed. Instead, the school used the money on parties.
The investigation into the non-existent program overturned other fraudulent activities including a payroll scheme that allowed school employees to commit benefit and tax fraud. The school even went as far as to create an agreement with local businesses where it would pay teachers in “coupons” that were redeemable at local stores. This way it appeared that the teachers earned less than they actually did so they could pay less in taxes and claim benefits to which they were not entitled.
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