‘Hundreds’ of Lakewood residents scrambling after welfare fraud raids, report says

LAKEWOOD — Members of Lakewood's largely Orthodox Jewish community have reportedly been scrambling after news that eight township residents were arrested on Monday on charges that they received government benefits fraudulently, and more arrests are likely this week.

The Asbury Park Press reported on Tuesday night "hundreds of residents" have been calling township officials looking for ways to avoid the same legal troubles as a rabbi and seven other people charged to date. The story also said that people are calling Ocean County Community Services to either end their benefits or provide more current information for the system.

"The pressure of the community overhead — especially the (cost of) private schooling is unsustainable," the Press quoted Duvi Honig, of the Orthodox Jewish Chamber of Commerce, saying. "People are forced to find ways to bend the system."

Honig told New Jersey 101.5 on Wednesday that his comments to the Press were a reflection of frustration among a community whose members do not want to be on government programs but need them in order to provide for their families.

"It's not just for the Jewish community, it's all communities," he said.

While the Chamber is based in New Jersey, Honig said it works in multiple states including New York and said he has seen how other states are ahead of New Jersey in helping people get off of government assistance. In a place like Lakewood, where the population is growing so quickly, he said effective programs are needed to help people of various religions and races.

Honig also said that he was referring to tax loopholes and other legal methods people use to bend the system and was not in any way condoning the abuse of the benefits system shown by the people recently arrested.

Lakewood's school district has often been criticized by education advocates for its spending on out-of-district special-education and religious schools, serving the town's Orthodox population. The public school district itself serves a mostly black and Latino population, and nearly fired about 140 teachers this year when it faced a $15 million shortfall.

Edward Bertucio, the lawyer for Rabbi Zalmen Sorotzkin and his wife, Tzipporah — both of whom were released from jail Monday pending further proceedings — told New Jersey 101.5 that the two look forward to the legal process continuing.

"They maintain their innocence," Bertucio said. "This has been an ongoing investigation for several years. They've cooperated because they've done nothing wrong."

Bertucio said his clients "intend to fight this case vigorously in court toward their exoneration."

While he would not get into the specifics of whether Zalmen Sortozkin was continuing in his role as leader of the Bais Medrash Lutzk congregation, Bertucio said it was "life and business as usual for the rabbi and his wife."

The Sorotzkins were two of eight people arrested in Lakewood on Monday, some facing local and some facing federal charges. Collectively, they're accused of receiving several hundreds of thousands of dollars worth of food, housing, and medical benefits despite income levels that would disqualify them from the various programs. Some of those arrested had $1 million-plus incomes, authorities have said.

The rabbi's brother, Mordechai, and his wife, Rachel, are facing federal charges after they allegedly applied for and received medicaid benefits for themselves and their children. According to Acting U.S. Attorney William E. Fitzpatrick, the family was receiving Medicaid from 2011 through 2014 despite making millions of dollars during that time.

Yocheved and Shimon Nussbaum are also facing federal charges. Fitzpatrick said they created several companies that they controlled, and opened bank accounts in the names of those companies to hide their income while still collecting benefits. In addition to applying for Medicaid, the couple also applied for Section 8 housing and food stamps, Fitzpatrick said.

Also charged at the local level were Mordechai and Jocheved Breskin, who, authorities say, collected more than $500,000 in benefits including Medicaid, food stamps, Social Security and HUD between January 2009 and December 2014.

Al Della Fave, a spokesman for the Ocean County Prosecutor's Office, said the investigation is ongoing and more arrests are expected this week. A Star-Ledger column Tuesday, citing an unnamed law enforcement source, said this week's charges have ties to a money laundering case involving beeper store owner Yisroel Malamud, who pleaded guilty tor running an unlicensed money transfer business earlier this year.

The story also said more arrests could be coming as early as Wednesday morning.

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Contact reporter Adam Hochron at 609-359-5326 or Adam.Hochron@townsquaremedia.com