Sacramento Bee A federal judge in Sacramento ruled late Tuesday that the California
branch of one of the world’s largest Jewish religious organizations
misappropriated grant funds and now must pay $844,985 in damages and
penalties.
U.S. District Judge Morrison C. England Jr. found that Chabad of
California violated the federal False Claims Act with bogus statements
and certifications in connection with money it obtained through the
Urban Areas Security Initiative: Nonprofit Security Grant Program, which
provides funding for security upgrades to eligible nonprofits.
The U.S. Department of Homeland Security program is administered here through the California Emergency Management Agency.
In a 21-page order, England found that Chabad knowingly failed to
comply with grant requirements and falsely assured the government that
it had written procedures to regulate the use of the funds.[...]
“Rabbi Cunin made it clear that the absence of policies was not an
oversight” and “conceded that he never planned to safeguard the grant
advances and ensure that funds so received were used only to pay
authorized grant costs,” England said.
Cunin “treated the grant advances as if they were gifts to Chabad
that, once paid by Cal EMA, were ‘no longer the business of the
government,’” England said, quoting the rabbi’s deposition testimony.
“(Cunin’s) cavalier attitude shows, at minimum, a reckless disregard.” [...]
The whistleblowers, Aria Kozak and his wife, Donna Kozak, of Santa
Monica, through their company, Elite Interactive Solutions, installed
state-of-the-art video surveillance equipment in several Chabad of
California facilities, but were not paid for the work despite repeated
requests, according to Hirst. [...]