Four men, including two Five Towns residents, were indicted for a scheme in which they allegedly stole more than $12.4 million in city and state money between 2005 and 2012 — funding that was expected to help special needs students between 3- and 5-years-old — from a Far Rockaway pre-school.
Queens District Attorney Richard Brown identified the men as Ira Kurman, 52, of Westwood Road, Hewlett; Roy Hoffman, Hazel Place, Woodmere; Rabbi Samuel Hiller, 56, Elvira Drive, Far Rockaway, and Daniel Lanaido, East 17th Street, Brooklyn.
“It is disheartening to see a betrayal of the magnitude alleged in this indictment,” Brown said in a prepared statement. “The public funds provided to Island Child Care Development Center were earmarked for special needs pre-schoolers with disabilities but instead were allegedly use by the defendants for their own purposes. This investigation makes clear that frauds of this nature will inevitably be exposed and rooted out and that those who engage in them will be brought to justice.”
The alleged thefts were uncovered after the state comptroller’s office told the center and specifically Kurman, the former executive director, that it was going to conduct a routine audit of the special education itinerant teachers funds that are given to the center. Auditors arrived for a meeting in July 2012, but were told that Kurman left his position and supposedly took center’s financial books and records with him. Following the auditors investigation they notified the district attorney’s office.
Hoffman was hired by the center as an independent auditor as required by state law, Hiller is the center’s assistant director and Lanaido is a self-described “investor” in the center.
Between those seven years, the center received about $27 million in state funding. It is alleged that $12.5 million was illegally funneled by the men for their personal use, to their families, other businesses and to local members of their religious communities.
Approximately $8 million was allegedly steered by Hiller to several religious schools and camps not associated with the center, including $3 million to B’nos Bais Yaakov Academy, a private all girls school in Far Rockaway, where he is the principal. In addition, a portion of that $8 million was diverted to a related summer camp for Orthodox youth — Camp Malka — in upstate Greene County, and Camp Ohra Day in Far Rockaway. The school and camps used the money to pay for hot lunches and other kosher food services, carpeting, vehicles and employee salaries. There was also plumbing work allegedly done at Hiller’s home at a cost of $30,000.
It is alleged that an estimated $300,000 was used to finance the redesign of Hoffman’s house and another $15,000 was given to his wife, a make-up retailer. More than $1 million in center checks were allegedly cashed or were cashed by Lanaido, the owner of a kosher supermarket in Borough Park, using check cashing locations. Many of the checks were in the names of individuals or businesses who had not consented to permit Lanaido to cash the checks in their names.
Besides the possibility of being convicted on the multiple charges including grand larceny, falsifying business records and identity theft and facing up to 25 years in prison, the district attorney is looking to recover the remaining $11.7 million. About $1 million was repaid by the B’nos Bais Yaakov Academy and Camp Malka.
“These individuals allegedly stole millions of taxpayer dollars meant for special needs children in brazen disregards for common decency and the law,” State Comptroller Thomas DiNapoli said in a statement. “I thank District Attorney Brown and his staff for working closely with us to uncover this violation of public trust and pursuing justice for taxpayers.”