The three are suspected of defrauding the Education Ministry into funding their fictitious association, supposedly schooling several hundred girls.
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The fictitious association listed students who were actually attending another school, which never applied for financial support by the Education Ministry, as it does not recognize the State's authority.
An undercover investigation was launched in the matter several months ago. The police suspect the con dates back to 2005. The money trail remains unclear at this time, but once suspicions were confirmed, the police arrested the head of the association and two other members.
An indictment in a similar case was filed with the Jerusalem District Court on Monday, against 10 suspects. The men are accused of laundering NIS 48 millions (roughly $12.2 millions) through fictitious haredi associations.
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