NYC Hasidic School Will Pay $8M In Massive Fraud Case: Feds

NEW YORK CITY — The leaders of a prominent Hasidic school in Brooklyn admitted they fraudulently stole millions of dollars from government programs, including one meant to feed needy children, federal prosecutors announced Monday.

Central United Talmudic Academy's operators agreed to pay $8 million in fines and restitution as part of a deal to avoid prosecution on a years-long fraud scheme, according to court documents.

The deal is not only an admission of guilt, but also provides a path for the school to repair its damage to the community, said U.S. Attorney Breon Peace.

“The misconduct at CUTA was systemic and wide ranging, including stealing over $3 million allocated for schoolchildren in need of meals,” he said in a statement.

Central United Talmudic Academy runs the state's largest all-boys yeshiva, a 2,500-student school within a sprawling building along Wythe Avenue in Williamsburg, according to court documents and the New York Times.

But behind the school's facade, prosecutors argued that a culture of fraud permeated the school's leadership, according to court documents.

The largest fraud outlined in court documents centered around a supper program, for which the school's leaders received $3.3 million in federal reimbursement between 2014 and 2015.

"The overwhelming majority of meals claimed by CUTA were fictitious," documents state, noting they did not meet nutritional requirements.

"From 2014 until late 2015, virtually all of the supper claims that
CUTA submitted were fraudulent."

Yeshiva employers also made salary payments to people who were not actually working at the school, otherwise known as "no-show employment," in addition to other fraudulent schemes, prosecutors said.

The deal comes amid increased scrutiny of yeshivas in New York, especially after a bombshell New York Times investigation — that prominently featured Central United Talmudic Academy — found many such schools reaped hundreds of millions of dollars in government aid, but failed to provide a basic education.

Mayor Eric Adams, when previously asked about the New York Times report, essentially waved off the findings in favor of a still-to-be-completed city investigation.

"I'm not going to look at a story," he said. "I want a thorough investigation, I want an independent review, and that's what the city has to do."