Menachem “Max” Lieberman has been sentenced to 52 months in prison for his involvement in fraudulent schemes related to federally funded childcare programs. The sentence was handed down by U.S. District Judge Jennifer H. Rearden, following Lieberman’s guilty plea.
U.S. Attorney Jay Clayton stated, “Max Lieberman defrauded federal childcare programs that provide vital services to our most innocent and vulnerable.” He emphasized the importance of protecting public trust and ensuring opportunities for children are not exploited for personal gain.
The case against Lieberman involved two main schemes targeting federal grant programs intended to assist low-income families with childcare needs. From 2019 to January 2023, Lieberman secretly controlled Project Social Care Head Start Inc., a non-profit organization in New York City that received millions from the U.S. Department of Health and Human Services (HHS) under the Head Start program. Despite legal prohibitions on private ownership of such entities, Lieberman paid co-defendant Martin Handler $4.7 million for control over PSCHS and redirected funds to his own companies.
To maintain control over these funds, Lieberman misled HHS by falsely claiming an independent board was overseeing PSCHS and submitted false statements denying conflicts of interest or improper dealings.
In a separate scheme from July 2020 to January 2023, Lieberman defrauded nearly $2 million from the New York City Administration for Children’s Services (ACS). He submitted false applications with fake signatures and receipts for non-existent childcare programs, receiving over $1.8 million in reimbursements despite no actual attendance except briefly between September and October 2022.
Lieberman, aged 48 from Brooklyn, New York, will also serve three years of supervised release post-incarceration and pay fines totaling $200,000 along with restitution and forfeiture amounting to approximately $1.85 million each.
Jay Clayton commended the efforts of various investigative bodies including the FBI, IRS-Criminal Investigation Division, HHS Office of Inspector General among others who contributed significantly to this investigation.
Assistant U.S. Attorneys Daniel H. Wolf, Catherine Ghosh, Jacob R. Fiddelman, Stephanie Simon along with Paralegal Specialist Nandita Vasantha managed the prosecution under the Office’s Public Corruption Unit.
