Ex-Schechter School of Long Island CFO David Ostrove gave co-worker $30,000 gift in school funds, witness tells jury
Ex-Schechter School of Long Island CFO David Ostrove arrives in Suffolk County Court in Riverhead for his trial on Wednesday. Credit: James Carbone
A Schechter School of Long Island business official described a former colleague accused of stealing $8.4 million from the school as "very generous," saying she once accepted a $30,000 check from him before learning it was money that belonged to the school, she testified at his criminal trial Wednesday.
Julia Hardy, the K-12 Jewish day school's business director, said after learning her husband, a Navy Reservist, was deployed to the Middle East in September 2021, former Schechter School chief financial officer David Ostrove presented her with the certified bank check to cover the loss of her husband's civilian income.
"David was always very concerned with everyone's well being," Hardy said in testimony at her former colleague's trial. "... I felt very honored that he would do something like that for me."
Hardy would learn later that school year, as Suffolk County District Attorney investigators began to investigate suspicious transactions involving the school's PayPal accounts, that the funds she received from Ostrove belonged to the school, she testified.
Ostrove, 52, of West Islip, is charged with first-degree grand larceny and first-degree money laundering in the trial before state Supreme Court Justice John Collins in Riverhead. An 11-year employee of the school, he is accused of diverting the funds over an eight-year period from 2014-22 from school PayPal and Stripe accounts into personal banking platforms and using the money to buy three luxury vehicles, sports collectibles, historical memorabilia, coins and five homes on Fire Island.
Hardy said she believed Ostrove, who earned an $85,000 salary from the Williston Park school, had established personal wealth through an earlier career in finance, and that he raised the $30,000 on her behalf with the support of colleagues.
After discussing the gift with her husband, she deposited the money into a new bank account, and they planned to only use it in an emergency.
"We decided to hold onto it as a safety net," Hardy said.
That changed eight months later, when the district attorney's office reclaimed the funds through a civil forfeiture filing, according to Hardy's testimony and court records.
Ostrove was suspended from the school on April 21, 2022, and arrested less than three months later.
Five corporations Ostrove set up to purchase the Fire Island homes were also charged with money laundering.
Prosecutors have said Ostrove earned $600,000 in rental income from the properties between 2018 and 2022.
Hardy also testified that she maintained tuition records in her role at the school. Ostrove has been accused by prosecutors of removing three binders belonging to Hardy on May 4, 2022, two weeks after he was suspended and on the eve of a meeting investigators set to review the records with school officials.
Yvonne Lyon, another former school business official, said she had let Ostrove into the school business office that evening as she sought help from him with her work.
Upon cross examination from defense attorney Ralph Franco Jr., of Manhattan, Lyon said she had permission from the former head of school to allow Ostrove to recover personal belongings from the office. Lyon said she did not see Ostrove remove Hardy's binders.
The trial continues in Riverhead on Thursday.
Grant Parpan covers Suffolk County courts and federal courts for Newsday. A Long Island native, he joined Newsday in 2022.
