The Times had reported in September that scores of Hasidic boys’ yeshivas in Brooklyn and the lower Hudson Valley have collected about $1 billion in taxpayer money in recent years while failing to provide a basic secular education.
The alleged fraud involving the child care companies began several years ago, when Mr. Handler, who was then the executive director of a nonprofit day care company that provided services all across the city, secretly acquired the company and then used it to fraudulently bill the government, according to the indictment.
At that day care center, Mr. Handler and some of his partners created a “fake after-school program” that sought reimbursement for caring for children who were not actually enrolled, prosecutors said.
Mr. Handler also opened another company and created a partnership between the two, lying to the government about it, according to the indictment.
Mr. Handler also funneled about $118,050 monthly to pay off a loan that he took from a business partner, a co-defendant in the case, prosecutors said. Mr. Handler gave the partner’s wife and grandson no-show jobs with salaries of $90,000 in total and bought the partner’s wife a luxury sport utility vehicle, prosecutors said.
The indictment said that the government is seeking to have Mr. Handler forfeit seven properties across Brooklyn, Staten Island, the lower Hudson Valley and south Florida, as well as several religious items, including a copy of a book personally inscribed by a prominent Talmudic scholar in the 1700s, along with a booklet dating from nineteenth-century Baghdad and a list of blessings printed by silk-weavers in sixteenth-century Bologna, Italy.
The announcement on Wednesday marked the second time in recent months that federal prosecutors have taken aim at Orthodox and Hasidic education providers. In October, the state’s largest Hasidic boys’ yeshiva, the Central United Talmudical Academy, in Williamsburg, admitted to illegally diverting millions of dollars from government programs as part of a deal to avoid federal prosecution.