http://www.app.com/story/news/investigations/watchdog/2017/06/26/lakewood-welfare-fraud/424127001/
WATCH: WELFARE RAID IN LAKEWOOD Lakewood couples arrested this morning to appear in court | 0:44
LAKEWOOD — A prominent rabbi and several others were arrested in simultaneous federal and state raids Monday morning on charges related to alleged public assistance fraud on a scale rarely seen before in New Jersey, according to law enforcement sources.
Rabbi Zalmen Sorotzkin, who runs the synagogue Congregation Lutzk and businesses linked to the synagogue, was taken into custody Monday and is facing charges of theft by deception in Ocean County Superior Court.
The investigation found an alleged scheme that “rival the most sophisticated of financial frauds,” the source said.
The Breskins are being charged with second-degree theft by deception for allegedly collecting $585,662 in public assistance benefits they weren’t entitled to, the prosecutor said in the statement.
Zalmen and Tzipporah Sorotzkin face the same charges for allegedly collecting $338,642 in Medicaid, food stamps, Section 8 housing subsidies and Supplemental Security Income, according to the prosecutor’s office.
The Nussbaums allegedly under-reported their incomes and failed to disclose money they received from a number of companies in order to collect Medicaid, Section 8 housing assistance and food stamps between 2011 and 2014, according to a federal complaint signed by FBI Special Agent Michael Farina.
In that time, the Nussbaums allegedly collected $178,762 in public assistance they weren’t entitled to get. Read the full complaints at the bottom of the page.
The complaint against Mordechai and Rachel Sorotzkin accuses them of also under-reporting their incomes to collect Medicaid. Rachel Sorotzkin allegedly failed to report $1.5 million she received from a limited liability company when signing up for public assistance.
In the complaint, Farina wrote that Mordechai and Rachel Sorotzkin received more than $96,000 in Medicaid funds they shouldn’t have claimed.
Both couples face separate counts of conspiring to steal government funds, according to a statement from the U.S. Attorney’s office. The conspiracy counts each carry a maximum potential penalty of up to five years in prison and a $250,000 fine, or twice the gain from the offense.
Also arrested in the sting headed by the FBI, Ocean County Prosecutor’s Office and other agencies were Zalmen’s wife, Tzipporah Sorotzkin, and married couple Mordechai and Jocheved Breskin. The three also face state criminal charges, according to a source close to the case who spoke on the condition of anonymity because of the ongoing investigation. Their first appearance before a Superior Court judge is scheduled for Monday afternoon.
EXCLUSIVE: SCHI overcharged Lakewood, others by $340K
Four others were arrested Monday and are being taken to Trenton to face federal charges in U.S. District Court. They are Mordechai Sorotzkin, brother of Zalmen, and his wife, Rachel Sorotzkin, and Shimon and Yocheved Nussbaum. View the map below for the locations of the homes raided or attempted to be raided Monday.
“Financial assistance programs are designed to alleviate family hardships for those truly in need,” said Ocean County Prosecutor Joseph Coronato in a statement. “My office gave clear guidance and notice to the Lakewood community in 2015 of what is considered financial abuse of these programs.
“Those who choose to ignore those warnings by seeking to illegally profit on the backs of taxpayers will pay the punitive price of their actions.”
Federal and state agents fanned out to the four Lakewood homes early Monday morning, mostly in black, unmarked cars. FBI agents repeatedly knocked on Rabbi Sorotzkin’s door just before 6 a.m, to no immediate answer. But he was in custody, along with the seven others, by 7 a.m.
Around the same time on Hadassah Lane, agents waited with the Nussbaums in their townhouse while the couple found someone to watch their children, one of whom was seen packing suitcases and boxes into a van parked in front of the house. The couple was then placed in a black law enforcement van.
The Lakewood residents are accused of taking advantage of multiple public assistance programs to defraud the government of around $1.3 million over the past few years, according to law enforcement sources.
“The investigation to date has found that government benefits fraud and income tax evasion in the Lakewood community is widespread,” said the source.
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