More than 300 FBI agents, with search warrants in their hands, raided a number of yeshivas and businesses in the ultra-orthodox Jewish village of Ramapo in New York last month, searching for evidence that government funds allocated for the purchase of technology equipment in schools had been used as mandated, on wiring, servers and internet installation. The agents were seen leaving the raided yeshivas and businesses with boxes of documents and computer hard drives.
The raid came after Jewish news agencies raised questions about the use of federal funds in Orthodox schools and libraries, since many of these institutions prohibit their students from using technology as well as the internet.
One of the businesses targeted on March 16, includes Hashomer Alarm Systems, which has reportedly received millions in grants from the Federal Communications Commission’s E-Rate Program that reimburses up to 90 percent of all costs incurred in wiring and server installation in schools and libraries, where at least 75 percent of students are eligible for free lunch. In 2013, Hashomer Alarm Systems was considered one of the largest E-rate service providers in Ramapo after being awarded over $3 million in E-rate contracts in 2011. It managed to do more business in the Jewish community than Sprint, Verizon and Nextel combined.
In the E-Rate Program, money is not directly given to schools but businesses, known as service providers, which are supposed to make available technology equipment and services. Haredi Orthodox yeshivas typically work with small Jewish-owned businesses, whose E-Rate contracts are almost exclusive. In 2013, news reports suggested that most of these businesses had no websites or storefronts and that some of them even had overlapping owners.
An investigation by Jewish Week in 2011 also found that over 20 percent of the state’s E-Rate grants were being granted to Hasidic yeshivas in Rockland County and Brooklyn even though they enroll only four percent of New York’s students. The largest recipients among Jewish schools and libraries were the ultra-orthodox, who had only recently participated in a massive rally condemning the internet as evil.
Despite as many as 22 raids being carried out on Wednesday, no arrests were made. While the United States Attorney General’s office confirmed the investigation, it refused to elaborate on any specifics.
“Today, the FBI, working with our office, conducted searches in connection with an ongoing fraud investigation,” the AG's office said in a statement. “If and when charges are filed, they will eventually become public.”
Since its launch in 1998, the E-Rate Program has struggled with fraud. While two reports by the General Accounting Office have made note of existing problems within the nonprofit’s internal controls, several multimillion-dollar fraud cases involving Universal Service Administrative Company, which administers the E-Rate Program on behalf of Federal Communications Commission, have been exposed as well.
According to local news reports, the FBI made use of an Orthodox Jewish radio program as well as a haredi Orthodox informant as part of a sting operation to lead its agents to several officials who were involved in corruption scandals in Rockland County and Brooklyn.
Photo Credits: New York Times
