Federal agents converged on the upstate chasidic community of Kiryas Joel last Thursday, sealing off part of the community in an early morning raid to catch an alleged ring of swindlers.The agents arrested nine men, including Mordechai Samet, 40, the alleged ringleader, and later charged 14 people with a total of 68 counts of cheating individuals, banks, insurance companies and the government out of millions of dollars.
Prosecutors say the arrests stemmed from a two-year investigation and that the men, whom they referred to as the Samet Group, created an elaborate web of false information to carry out frauds. The men allegedly created phony identities, fraudulent social security numbers and tax identification numbers in order to obtain benefits for non-existent people.
Members of the group were also charged with scheming to obtain over $1 million in fraudulent small business loans, defrauding banks by using counterfeit checks totaling $6 million, and various schemes to defraud life insurance companies, and with credit card fraud stemming from an alleged pyramid scheme.
Authorities charged that men had been carrying out their scheme since 1996, and had used a sophisticated system of telephone voice-mail accounts and post office boxes to avoid being connected to their schemes.The defendants entered no plea when charged in federal court in White Plains last week. A pre-trail hearing is set for April 10.
This case demonstrates how vulnerable private companies and public entities can be when racketeering enterprises which are versed in finance and business practices use that knowledge to carry out frauds, said the United States attorney for the Southern District in New York, Mary Jo White, who is prosecuting the case in coordination with the Internal Revenue Service, the U.S. Postal Inspection Service, the Social Security Administration and the district attorneys of Rockland and Orange counties.
Calls to Samets home on Tuesday were not answered. His attorney, Suzanne Brody of the federal defenders office in White Plains, did not return a message left on Tuesday.The raid on Kiryas Joel, a Satmar enclave whose efforts to create a one-district school for disabled children have created a constitutional controversy, began at 6 a.m., when agents disguised as deliverymen entered the town, according to residents.
Access to some streets was denied by agents toting shotguns, said Joseph Waldman, a community activist and clothing manufacturer. He said he and other residents were upset at the extent of the operation used to apprehend alleged white-collar criminals in a community where violence is rare.
A spokesman for the FBI in New York, Joseph Valiquette, said the operation was routine. Whenever the FBI goes out on an arrest operation, we certainly go with enough agent power to ensure everyones safety, he said. In this case we were going to arrest eight or ten people from that community. We didnt do anything in that community that we wouldnt do on the Upper East Side of Manhattan. Valiquette said he was aware of no complaints from the community regarding excessive force.Another member of the Satmar community, who lives in Brooklyn but is acquainted with some of the defendants, said he was undisturbed by the agents methods.
Certain people think it has to do with anti-Semitism, said Isaac Weinberger, a city employee from Williamsburg, Brooklyn. But I think they were afraid [Samet] would flee. Nobody would blame the agents how they came in. Maybe they shouldnt have come in at 6 a.m. to wake up children, but its understandable.
Waldman said the arrests had caused the village residents to feel very sad and ashamed. This gives a very bad name to the community. I hope the accusations are untrue. It doesnt help this particular community and the chasidic community as a whole.In addition to Samet, the other defendants are Chaim Hollender and Moses Weiss, both 25; Kalmen Eisenberg, 24; Moses Perl, 34; Hershber Hirsch, 23; Yishrael Leibowitz, 39; Cheskel Samet, 23; Yuda Weiss, 33; David Hershkowitz, 22; Yehuda Steinberg, 30; Joseph Jacob, 32; Aaron Solinsky, 62 and Chaim Wiesel, 33.
The defendants face a range of charges, the most serious being racketeering, which carries a sentence of 20 years, faced by Samet and seven others. Other charges brought against members of the group include money laundering, wire fraud, false statements and bank fraud. The latter charge carries a 30-year sentence.
Although I couldn’t find the article posted above to date it, I believe the activities listed date back to about 1996-—and were prosecuted about 2007........or thereabouts.