Wealthy Orthodox Couples Charged in $1.3M Brooklyn Benefits Scam
Crackdown: Preet Bharara, federal Manhattan prosecutor, said Samuel Waldman was arrested in a crackdown on internet child porn. Image by getty images
By Josh Nathan-Kazis September 30, 2016
Federal prosecutors charged three Brooklyn couples lying about their assets to qualify for a raft of government programs meant to aid poor people.
The six men and women, all in their late thirties and early forties, were arrested in Williamsburg on September 27. News of their arrests spread fast on Orthodox social media channels.
They were charged in two separate criminal complaints filed in the Southern District of New York with hiding their wealth to receive Section 8 housing benefits, health insurance through Medicaid, and food stamps through the Supplemental Nutritional Assistance Program.
All together, they are accused of improperly receiving $1.3 million in government benefits.
“These defendants were millionaires stealing from the poor, as charged,” said Mark G. Peters, commissioner of the New York City Department of Investigation, which investigated the case, in a press release. “At a time when affordable housing is scarce, and there is a waiting list for Section 8 vouchers, it is reprehensible that some New Yorkers went without so that these defendants could have still more.”
The Section 8 housing benefits allegedly abused by the couples, a rental subsidy paid for by the federal government and administered by the New York City Housing Authority, are central to the finances of many Hasidic families in Williamsburg. High levels of enrollment in the Section 8 program have allowed the Hasidic community there to cope with its massive population growth, even as real estate values in the neighborhood have skyrocketed.
Yet the unusually large numbers of families in the community that rely on the program has raised questions. The New York Daily News and WNYC reported in a joint investigation in May residents of the Hasidic portion of Williamsburg receive more vouchers through Section 8 than residents in any other part of the city.
The Daily News report listed a number of high-profile instances in which wealthy and prominent members of the Hasidic community had fraudulently qualified for Section 8 vouchers.
Now, the six men and women arrested this week can allegedly be added to that list.
One of the arrested men, Shlomo Kubitshuk, owned a large number of apartment buildings in Brooklyn, according to the complaint, and received rental income that totaled over $560,000 in 2013. Yet Kubitshuk and his wife allegedly NYCHA that they earned up to $13,000 a year between 2002 and 2011, and that they had no assets. According to the complaint, they were eligible for none of the $146,000 that NYCHA paid their landlord.
Prosecutors assert in a separate complaint that another defendant, Leib Teitelbaum, said in a credit card application in 2006 that he earned $1.2 million per year. Amounts charged to that card, and to other accounts tied to Tietelbaum and his wife, Devorah, were more than the household income that the couple reported to qualify for their Section 8 vouchers, according to the complaint.
The attorney for both the Kubitshuks and the Teitelbaums, Susan Nechelles, did not respond to a request for comment.
The third couple, Naftali and Hinda Englander, are represented by Steven Yurowitz, who also did not respond to a request for comment.
Contact Josh Nathan-Kazis at nathankazis@forward.com or follow him on Twitter, @joshnathankazis.
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