W’burg yeshiva owes $8 million in total for fraud
By Brooklyn Star Staff
A Williamsburg Yeshiva will have to pay $8 million after admitting to fraudulent fund for needy schoolchildren, federal prosecutors announced.
The Central United Talmudic Academy, which serves more than 5,000 Satmar students ranging from preschool to secondary school, was involved in multiple frauds according to the Monday Oct. 24 announcement.
$3 million has already been paid in restitution and an additional $5 million will have to be paid as part of a deferred prosecution agreement.
The yeshiva received more than $3.2 million in reimbursements, which was almost entirely fictitious according to federal prosecutors. The money was diverted to subsidize parties for adults and the school fabricated records to cover their tracks.
Investigators also discovered that the school engaged in various fraudulent payroll practices that enable school employees to commit tax fraud, the school provided no-show jobs and obtained technology funding for uses unrelated to educational
“The misconduct at CUTA was systemic and wide ranging, including stealing over $3 million allocated for schoolchildren in need of meals,” United States Attorney Peace said in a statement. “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.”
The school has instituted changes in its executive management team as well as instituting an oversight committee in the wake of the fraud.Beyond the fines and restitution, the school will be under the supervision of an independent monitor for a three-year period.