Brooklyn, NY – In a major blow to those who seek to exploit our nation’s most vulnerable citizens, Menachem ‘Max’ Lieberman, 48, of Brooklyn, NY, was sentenced to 52 months in prison for his role in a brazen $1.8 million childcare scam.
Lieberman’s scheme involved defrauding federal childcare programs, including the Head Start program and a federally funded childcare voucher program for low-income families. According to court filings, Lieberman secretly “owned” and exercised control over a non-profit entity, Project Social Care Head Start Inc. (PSCHS), that operated in the New York City area.
Between 2019 and 2021, Lieberman paid co-defendant Martin Handler $4.7 million to obtain “ownership” over PSCHS, and used his control over PSCHS to impermissibly direct PSCHS’s Head Start funding to his own for-profit companies. In order to protect his control over PSCHS’s funding, Lieberman conspired with others to impair HHS’s ability to provide effective oversight of PSCHS.
Lieberman’s scheme also involved applying for and receiving over $1.8 million in ACS reimbursements, even though the program did not actually exist and no children attended the program except for a brief period from September 2022 to October 2022.
“Max Lieberman defrauded federal childcare programs that provide vital services to our most innocent and vulnerable,” said U.S. Attorney Jay Clayton. “New Yorkers believe in opportunity, particularly for our children, and by defrauding our Head Start and childcare voucher programs, Max Lieberman exploited our collective belief in opportunity for his own financial gain.”
In addition to his prison sentence, Lieberman was also sentenced to three years of supervised release and ordered to pay a fine of $200,000, restitution of $1,854,543.35 to ACS, and forfeit $1,774,543.35. Mr. Clayton praised the outstanding work of the Federal Bureau of Investigation, Internal Revenue Service-Criminal Investigation, and HHS, Office of the Inspector General in bringing Lieberman to justice.
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Key Facts
- State: New York
- Agency: DOJ USAO
- Category: White Collar Crime
- Source: Official Source ↗
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