Three Former Child Day Care Center Owners Sentenced In Manhattan Federal Court For Participating In Bribery Scheme
Preet Bharara, the United States Attorney for the Southern District of New York, announced that LIUDMILA UMAROV, ELLA SCHVARZMAN, and RIMMA VOLOVNICK, former child day care center owners, were sentenced in Manhattan federal court for their roles in a bribery scheme. UMAROV, SCHVARZMAN, and VOLOVNICK each pled guilty pursuant to cooperation agreements to paying bribes to New York City officials in exchange for those officials taking official action to benefit day care centers in Brooklyn, New York. UMAROV was sentenced today by U.S. District Judge John F. Keenan to three years of probation. SCHVARZMAN was sentenced on May 14, 2013, by U.S. District Judge Thomas P. Griesa to three years of probation, and VOLOVNICK was sentenced on April 9, 2013, by U.S. District Judge Shira A. Scheindlin to two years of probation.
According to the Complaint that charged UMAROV and VOLOVNICK, the Informations to which UMAROV, SCHVARZMAN, and VOLOVNICK pled guilty, and statements made in Manhattan federal court during the guilty plea proceedings:
New York City has a day care subsidy program (“Day Care Subsidy Program”) whereby low-income families are eligible to receive day care subsidies. The City administers these child care subsidies in various ways, including through contracts with regulated day care centers and through “vouchers” paid to day care centers in which children of low-income parents are enrolled.
UMAROV, SCHVARZMAN, and VOLOVNICK are each former child day care center owners in Brooklyn, New York, who collectively paid more than $100,000 in bribes to City officials to help the three defendants steal from the Day Care Subsidy Program. Each of the defendants admitted to paying bribes to officials in exchange for, among other things, providing identification information of children that were eligible for the Day Care Subsidy Program but did not attend day care. This identification information was used by the defendants to seek reimbursement from the City for providing day care services to those children, even though those children did not in fact attend day care. Each of the defendants also admitted to paying bribes to officials in return for those officials overlooking health code violations at their day care centers.
In addition to probation, Judge Keenan also ordered UMAROV, 66, of Brooklyn, New York, to pay forfeiture in the amount of $100,000 and a $600 special assessment fee. Judge Griesa ordered SCHVARZMAN 46, of Brooklyn, New York, to forfeit $25,000 and imposed a $400 special assessment fee. Judge Scheindlin ordered VOLOVNICK, 57, of Brooklyn, New York, to forfeit $25,000 and imposed a $500 special assessment fee.
Mr. Bharara praised the investigative work of the New York City Department of Investigation (“DOI”).
UMAROV’s, SCHVARZMAN’s, and VOLOVNICK’s convictions are part of “Operation Pay Care,” a joint investigation led by the U.S. Attorney’s Office for the Southern District of New York and DOI. To date, 14 defendants – six City employees and eight day care owners – have been convicted as part of Operation Pay Care. Of the convicted defendants, six City officials have been sentenced: Leonid Gutnik, a former Job Opportunity Specialist/Child Care Specialist for the New York City Human Resources Administration (“HRA”), received 40 months in prison; Aurora Villareal, the former Borough Manager for Brooklyn and Staten Island Group Child Care Programs at the New York City Department of Health and Mental Hygeine (“DOHMH”) received four years in prison; New York City Fire Department (“FDNY”) Supervising Inspector Carlos Montoya received 30 months in prison; and Emile Nekhala, a former employee at DOHMH, received two years in prison. Mariya Rapoport, a former employee at HRA, and Carolyn Eason, a former employee at DOHMH, both pled guilty pursuant to cooperation agreements and were sentenced to terms of probation. Including Umarov, Schvartzman, and Volovnick, a total of seven day care operators have been sentenced – Lyudmila Grushko received nine months in prison, Inna Malinskaya received seven months in prison, Yana Krugly received six months in prison, and Grigoriy Sankin received three years of probation.
This case is being handled by the Office's Public Corruption Unit. Assistant U.S. Attorneys Harris Fischman, Michael Bosworth, and Brent Wible are in charge of the prosecution.