“Authorities today arrested seven people – including six Ramapo residents – who are accused of fraudulently obtaining millions of dollars through a federally subsidized program to provide electronic equipment to local yeshivas.
The arrests of Peretz Klein, 64, of Spring Valley, Susan Klein, 57, of Spring Valley, Ben Klein, 39, of Monsey, Simon Goldbrener. 55, of Monsey, Moshe Schwartz, 45, of Monroe in Orange County, Sholem Steinberg, 39, of Monsey and Aron Melber, 42, of Monsey resulted from a series of raids on multiple Ramapo businesses and schools in 2016.
They were all charged with various counts of conspiracy to commit wire fraud. The statute sets a prison sentence of 20 years for the crime, though a judge has discretion under federal sentencing guidelines.
They are accused of obtaining millions of dollars in E-Rate funds and defrauding the program that helps educate underprivileged children between 2010 and 2016, according to a federal indictment.
The E-Rate program is designed to help schools serving underprivileged students obtain internet access and other forms of communications technology by substantially reimbursing the schools for purchasing the necessary equipment and services from private vendors.
As vendors working with the federal government program, those arrested are charged with billing the E-Rate program for equipment and services that was not provided to the purchasers.
“For years, these defendants stole money from the E-Rate program, billing the E-Rate program for equipment and services which were not in fact provided,” U.S. Attorney Geoffrey Berman said in a statement.
Berman said those charged “fraudulently obtained millions of dollars in E rate funds to which they were not entitled, and which should lawfully have been spent to help provide access to technology to educate underprivileged children.”
“This indictment is important not only because fraudsters should be held to account for their crimes, but also because the next generation of students should have access to telecommunication services, internet access, and related equipment, irrespective of their means and in spite of the fact that people like the defendants seek to line their own pockets at the expense of underprivileged children,” Berman said.
The arrests came before dawn in Ramapo by the FBI and detectives with the Rockland District Attorney’s Office — the two agencies that led the raids of 22 businesses and private schools in March 2016.
During those raids, hundreds of FBI agents and Rockland District Attorney’s Office detectives descended on the ultra-Orthodox private schools and companies, seizing payment records, equipment and other documents as part of an investigation on whether the federal money had been misused.
The raids were part of an investigation into whether local yeshivas properly spent money obtained through the federal government’s E-Rate program, overseen by the Universal Service Administration Co. for the Federal Communications Commission.
Rockland District Attorney Thomas Zugibe said his prosecutors and detectives worked with the FBI on the case.”
Read the complete Journal News coverage here.