Arie Rangott has been sentenced to 27 months in prison for his involvement in a scheme to defraud the federal Head Start program and obstruct a federal investigation. The sentencing was announced by Acting United States Attorney Matthew Podolsky for the Southern District of New York. Rangott's conviction came after a two-and-a-half-week trial presided over by U.S. District Judge Jennifer H. Rearden.
"Arie Rangott defrauded a vital federal childcare program that aims to serve one of society’s most vulnerable populations," stated Acting U.S. Attorney Matthew Podolsky. "This Office is committed to bringing to justice those who place greed above their responsibility to be stewards of federal funds, and I commend our law enforcement partners and the dedicated team of career prosecutors for their outstanding work."
The case centered around Rangott's role as the shadow executive director of Project Social Care Head Start Inc. (PSCHS), which operated in the New York City area between 2021 and January 2023. The U.S. Department of Health and Human Services (HHS) provided millions annually to PSCHS under the condition that it would be managed by an independent board of directors with strict controls against fraud, waste, and abuse.
Rangott and his associates submitted false documents asserting compliance with these conditions while using PSCHS funds for personal gain through undisclosed self-dealing with companies owned by co-conspirators.
In December 2021, HHS raised concerns about self-dealing at PSCHS, prompting Rangott and others to submit misleading reports denying any wrongdoing. Further obstruction occurred during an investigation launched by HHS's Office of the Inspector General in August 2022.
Several co-conspirators have pleaded guilty; Martin Handler received a 58-month sentence in October 2024, while Isidore Handler was sentenced to 18 months in December 2024. Menachem Lieberman awaits sentencing.
Rangott, aged 54 from Toms River, New Jersey, will also face two years of supervised release following his prison term.
Mr. Podolsky commended the investigative efforts led by the Federal Bureau of Investigation, Internal Revenue Service – Criminal Investigation, and HHS Office of the Inspector General, along with assistance from other agencies including the U.S. Department of Agriculture Office of the Inspector General and New York City Department of Investigation.
The case prosecution was handled by Assistant U.S. Attorneys Jacob R. Fiddelman, Catherine Ghosh, Stephanie Simon, Daniel H. Wolf, supported by Paralegal Specialist Jayda Foote from the Public Corruption Unit.
