Federal authorities charged 12 members of a single New York family Thursday with numerous counts of fraud connected to an elaborate scheme in which family members claimed to be wealthy in order to secure mortgage loans but at other times claimed to be poor so they could collect food stamps and Medicaid.
At a press conference, held Thursday after the indictment was unsealed, U.S. Attorney Preet Bharara attempted to explain the fraud.
“The defendants involved alternately played the parts of prince and pauper depending on which scam was being perpetrated,” he said, according to USA Today. “There's a lot of fraud here and shell games. ... The fraud was complex and they were fairly organized.”
Bharara said the investigation is continuing. So far, 13 suspects have been arrested. Two more are expected to surrender soon. Most of the family members are from Brooklyn, Manhattan and communities in Orange County.
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Bharara explained that family members used falsified documents to secure $20 million in mortgage loans, many of which later went into default. Proceeds from those loans reportedly went to pay credit card bills and other debts, according to NBC-New York. The 21 count indictment alleges that some members of the family then turned around and filed for assistance programs once they defaulted on the loans.
The indictment names 29-year-old Irving Rubin as the organizer of the scheme. Authorities say he benefited from at least 10 fraudulently obtained loans, claiming he was making a $25,000 a month in order to secure the funds. Court documents reportedly show that Rubin and his wife, Rachel Rubin, simultaneously claimed an income of roughly $900 a month in order to secure food stamps and Medicaid.
Bharara said authorities are still working to untangle the complicated web of deceit.
Authorities have served warrants to seize 23 properties worth $50 million.
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The Daily Mail reports court documents estimate the scheme netted the family about $20 million in fraudulently obtained bank funds and roughly $700,000 in taxpayer-provided benefits.
“Whether posing as rich men or poor men, they were always con men,” Bharara said.