Rabbi Shmuel Hiller, a resident of New York, is accused of embezzling more than $12.4 million from the budget for disabled students, through the 'Banot Beit Yaakov' institution under his management.
The four defendants, all Haredi, who were associated with one of New York's largest providers of special education services for disabled kindergarten children, will be tried this week on suspicion of involvement in 42 counts of the indictment, including: aggravated theft, identity theft, and falsification of records.
Queens District Attorney Richard Brown said that if convicted, they could face up to 25 years in prison.
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The four are accused of stealing money intended for the Queens Child Development Center, a nonprofit special education provider for ultra-Orthodox girls ages 3 to 5. "It’s not encouraging to see embezzlement on the scale of this indictment," Brown said.
Rabbi Shmuel Hiller and Roy Hoffman, the center's accountant and auditor, were accused of using the money to renovate their homes. Hoffman embezzled approximately 300,000$ for renovating his home, and another 15,000$ for his wife's makeup business. Hiller embezzled 30,000$ for plumbing work in his home.
Hiller is also accused of transferring $8 million to other schools and summer camps, of which $3 million went to Banut Beit Yaakov, which he directs.
The New York State Comptroller's Office said it uncovered the fraud when the center's former director, Ira Korman, absconded with the institution's tax and accounting books, just before a routine audit in the summer of 2012.
In the indictment, Korman is accused of transferring more than 143,000$ of the institution's funds for loans to community members, and for catering services for his daughter's wedding and his son's bar mitzvah.
The fourth defendant, Daniel Laniado, was described as an investor in the center, and is accused of cashing checks intended for the center totaling more than $1 million.
The center received approximately $27 million from the state between 2005 and 2012. In addition to the criminal charges, the District Attorney's Office is seeking forfeiture of over $11 million, of which over $1 million has already been forfeited.
