Lakewood SCHI founder gets new trial on corruption charges

NEW BRUNSWICK - A judge Tuesday granted a new trial for Rabbi Osher Eisemann, founder of Lakewood’s School for Children with Hidden Intelligence (SCHI) who was convicted of money laundering and corporate misconduct in 2019.

Superior Court Judge Joseph Paone issued an order for a new trial following a hearing Friday at which Eisemann’s attorney argued a new witness has information that exonerates him.

Defense attorney Lee Vartan told Paone at the hearing that while he was preparing for his client to be resentenced last year, under order from a panel of appellate judges, officials from the school suggested he interview one of its former bookkeepers. When he did, the former bookkeeper, Rochel Janowski, told him she made an accounting error in the school’s books in 2015, and that was the same entry that formed the basis for Eisemann’s criminal conviction, Vartan said.

Vartan argued that Eisemann, 65, of Lakewood, deserves a new trial not only because the new evidence from Janowski vindicated him, but because prosecutors knew about it and kept it from the defense.

“This is wholly exonerating evidence," Vartan said at Friday’s hearing. “The evidence that we have brought to bear before the court shows that Osher Eisemann is innocent."

Upon learning of Paone's decision granting his client a new trial, Vartan said the defense team looks forward to the future proceeding."We have never once waivered from the fact that Osher Eisemann is innocent," Vartan said. "The newly discovered evidence — evidence that prosecutors sat on for years — proves that. We are eager to get that evidence before a new trial jury and see Rabbi Eisemann fully and finally exonerated."

Osher Eisemann:Why Lakewood SCHI founder, sentenced to jail in 2019, hasn’t spent a day behind bars

The state Attorney General's Office, which prosecuted the case, is reviewing Paone's decision and plans to appeal it, an office spokesman said.

Deputy Attorney General John A. Nicodemo argued Friday that a new trial was unwarranted because Janowski’s claims were uncorroborated and contradicted by evidence presented at the 2019 trial.

Paone, in his written decision granting Eisemann a new trial, had a different take on Janowski's assertion.

“It does more than merely contradict the evidence adduced at trial; it goes to the central issue of defendant’s guilt and has the probable effect of exonerating the defendant," Paone wrote.”This court certainly agrees with the state that her testimony is ’evidence (which) must be reviewed with a certain degree of circumspection to ensure that it is not the product of fabrication and, if credible and material, is of sufficient weight that it would probably alter the outcome of the verdict in a new trial,’” Paone wrote. ”In the most literal sense, however, there can be no doubt that if Janowski is believed by a jury, the verdict will be different."

Eisemann stood trial here in February 2019 before Superior Court Judge Benjamin Bucca. He was convicted of the two charges, but acquitted of others, and sentenced by Bucca to 60 days in jail.

Osher Eisemann:Lakewood SCHI founder's sentence is too short, NJ argues

A panel of appellate judges, in a scathing opinion in 2020 that blasted Bucca for being too lenient on Eisemann, ordered that Eisemann be resentenced by a different judge. Both crimes Eisemann was convicted of, by law, carry prison terms of five to 10 years.

At the 2019 trial, the jury acquitted Eisemann of first-degree corruption of public resources, as well as theft and misapplication of entrusted property, but convicted him of money laundering and misconduct by a corporate official. The panel rejected allegations that Eisemann diverted $979,000 from the school to his own purposes, but it found he moved $200,000 of school money through private accounts, including his own, before funneling it back to the school through third-party organizations to make it appear he was repaying a debt.

The state alleged at the trial that the $200,000 was removed from the school’s account to write down a $200,000 debt Eisemann owed to Services for Hidden Intelligence LLC, the school’s nonprofit fundraising foundation.

Janowski, in a written certification, asserted she mistakenly entered the $200,000 credit on the loan account to balance the school’s books, not to write down a loan to Eisemann, as the state alleged. She said in the certification that Eisemann did not become aware of the mistaken bookkeeping entry until he was charged with crimes.

Paone noted in his opinion that the state, at the first trial, relied on the testimony of William Frederick, deputy chief of detectives for the Financial Crimes Bureau of the state Division of Criminal Justice, to assert it was Eisemann who was responsible for the $200,000 ledger entry to write down the loan, and that was the only evidence presented at the trial to suggest there was a loan. Frederick’s testimony was based on his review of the school’s books, Paone wrote. ”Janowski, on the other hand, is the person responsible for the bookkeeping entry at issue," the judge wrote. “She had first-hand knowledge."

Vartan argued Eisemann never owed the foundation money. Instead, years of state audits of the books show the foundation actually owes Eisemann more than $300,000, he said. There is no evidence of any loan from the foundation to Eisemann, he said.

Paone took note of the audited financial statements showing the foundation owed money to Eisemann, not the other way around, and said certifications submitted on behalf of the defendant by two certified public accountants corroborated Janowski’s certification that the account she credited was not a loan account, but a ”dumping account" used to balance the books.

Paone wrote that the state was aware Janowski made the ledger entry in question, but didn't call her to testify at the first trial and didn't turn over her identity to the defense. Despite that, Paone said he found no "willful misconduct" by the state to withhold exculpatory evidence from the defense.

Eisemann founded the SCHI school in 1995 to serve a handful of developmentally delayed, medically fragile and emotionally challenged children, in part because he has a child with special needs. The school, on Oak Street in Lakewood, now serves more than 600 special needs youngsters, according to its website.

The school receives about $1.8 million a month from public school districts that send students there, the state attorney general’s office said when charges were first brought against Eisemann in 2017.

SCHI and the Lakewood public school district historically have had a strong connection over the decades. The school district budgeted $5.5 million this school year for “extraordinary services" for students, with much of the money paid to SCHI. The extraordinary services budget is up $856,000 from the prior year, according to the school district’s budget summary.

Eisemann has been on a leave of absence from the school since he was first charged in the criminal case.

Paone scheduled a conference in the case for Aug. 9.

Kathleen Hopkins, a reporter in New Jersey since 1985, covers crime, court cases, legal issues and just about every major murder trial to hit Monmouth and Ocean counties. Contact her at khopkins@app.com.

This article originally appeared on Asbury Park Press: Lakewood NJ SCHI founder gets new trial on corruption charges