Seven-Year Court Case Ends

Government elects not to intervene in whistleblower 
lawsuit against Chabad’
s Michigan Jewish Institute.

JN STAFF

Jews in the D

N

early seven years after a whis-
tleblower filed suit against the 
Michigan Jewish Institute (MJI), 
the U.S. government has elected not to 
intervene.
The whistleblower, Dawn Klobuchar of 
Waterford, who worked at MJI as an IT 
manager, filed the sealed claim in October 
2013, under the federal False Claims Act. 
The suit triggered investigations into MJI 
that led to the loss of its accreditation.
This is an example of a “qui tam” law-
suit, where a private person pursues a 
criminal claim in the name of the govern-
ment and requires the plaintiff to give the 
government notice and an opportunity to 
take over, if it chooses. According to one 
attorney, the government, which usually 
makes its decision in 60 days, took an 
extraordinarily long time to decide not to 
take over the case. 
According to U.S. District Court fil-
ings released Jan. 6 and Jan. 14, the suit 
claimed that MJI allegedly enrolled thou-
sands of fictious and actual Israeli stu-
dents without their knowledge in a nonex-
istent study-abroad program designed to 
fraudulently obtain more than $40 million 
in federal Pell Grants, which MJI would 
then split between itself and participating 
yeshivahs and seminaries in Israel.

CHABAD LUBAVITCH OF 
MICHIGAN’
S RESPONSE 
According to a statement from the New 
York-based-Chabad, on behalf of Chabad 
Lubavitch of Michigan, which owns MJI: 
“In the years since it was founded, MJI has 
helped thousands of disadvantaged indi-
viduals realize their educational dreams, 
which, for many of them, would have been 
impossible to otherwise attain.
 “Outrageous claims by a disgruntled 
employee helped spark an almost sev-
en-year investigation, which brought the 
good work we were doing to a halt.

“We learned last week that the U.S. 
Attorney’
s office has concluded their 
investigation and that they will not be 
prosecuting the matter, finally bringing 
this saga to a close. The wheels of justice 
turn slowly, but we were confident all 
along that, ultimately, we would be vindi-
cated.”

DEPARTMENT OF EDUCATION 
INVESTIGATION
In July 2015, federal agents seized more 
than 100 boxes of files from MJI offices 
in Southfield in conjunction with a U.S. 
Department of Education investigation 
into its recertification. MJI lost its accredi-
tation on Sept. 27, 2015.
In 2016, the Education Department 
accused MJI of illegally obtaining federal 
Pell Grants in its study abroad program 
and denied the school recertification in 
the Title IV student financial aid program, 
making it no longer eligible to receive Pell 
Grants. MJI appealed the decision and 
lost. 
Michigan Jewish Institute filed its last 
nonprofit tax forms in 2015 and stopped 
functioning as a school in 2016. However, 
the school is still incorporated, accord-
ing to its annual report with Michigan’
s 
Department of Licensing and Regulatory 
Affairs, filed in November 2019 by its 
president, Rabbi Kasriel Shemtov.
According to the Chabad statement: 
“While we remain committed to fulfilling 
our mission of helping individuals achieve 
their academic goals, this news is still 
fresh, and we are determining the best 
path forward in realizing our vision. We 
are grateful to those who have stood by us 
throughout this almost-seven-year saga.”
The whistleblower now has three 
months to move forward with the suit or 
dismiss the claim, although she cannot do 
so without the consent of the U.S. govern-
ment, according to court documents. 

16 | JANUARY 23 • 2020 

The Well’s 
Daniel Horwitz
to Become CEO 
at Miami JCC

Rabbi Daniel Horwitz, founder of The 
Well, an innovative outreach organiza-
tion targeting unaffiliated young Jews in 
Metro Detroit, announced 
Friday that he will be relo-
cating to South Miami, 
Fla., to become CEO of the 
Alper JCC Miami. 
Horwitz, a native 
Detroiter, his wife, Miriam, 
and their three young chil-
dren will be moving in June. 
In a Facebook post Friday, Jan. 17, 
announcing his new position, Horwitz 
recounted how he was influenced by 
Detroit’
s JCC — from swimming and 
violin lessons to his bar mitzvah party 
to BBYO to playing in the Kenny 
Goldman League youth basketball and 
participating in Maccabi games — and 
said, “The opportunity to join the JCC 
movement in this leadership capacity is 
truly special.
”
“Our JCC helped shape me, and I’
m 
excited to lead an organization that has 
the potential to so powerfully shape 
others,
” he wrote. 
The Alper JCC has a $7 million annu-
al budget, 75 full-time employees and a 
23-acre campus with seven buildings. 
Horwitz, his staff and a $500,000 
annual budget grew The Well in five 
years “from concept to powerhouse.
” 
Horwitz thanked many people in his 
post for support of The Well, especially 
founding funder Lori Talsky, Rabbi Paul 
Yedwab and other Temple Israel clergy 
and staff. 
“I’
m incredibly proud of our work 
these past five years and am very excit-
ed for The Well to enter its next phase 
under new leadership so that it can 
reach even greater heights. Don’
t worry 
— The Well isn’
t drying up; it’
s plentiful, 
and people will still draw from it for 
years to come.
” 

Rabbi Daniel 
Horwitz