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Jewish Journal

Shlomo Rechnitz, the man who reportedly gifted the winning Powerball ticket: A career of mega-success, mega-philanthropy, and controversy

by Jared Sichel

Posted on Jan. 14, 2016 at 3:19 pm

Shlomo Rechnitz

Shlomo Rechnitz

***This story has been updated here.

Did Shlomo Rechnitz make a dream come true for one of his employees? Or did that employee's son concoct an elaborate hoax?

On Tuesday, Rechnitz purchased nearly 18,000 Powerball tickets for every employee and resident of his California nursing home empire. That may have paid off big time for a senior registered nurse at the Rechnitz-owned Park Avenue Healthcare & Wellness Center in Pomona.

A spokesman for Rechnitz told the Journal on Thursday that one of the nurses in Rechnitz's employ held a winning ticket from Wednesday night's drawing. The apparent winner, who has not yet been publically identified, would have been one of three winners of the record $1.6 billion Powerball jackpot.

Or not. 

The New York Daily News reported late Thursday that the entire report of the nurse's win was a hoax perpetrated by the nurse's son. Asked to respond to the Daily News report, Rechnitz spokesman Joshua Nass said, "If it is indeed a hoax it is an abhorrent thing that took place. What we did was to relay a series of events that transpired yesterday evening at the home that we have footage of that would’ve led any reasonable minded person to draw that conclusion."

The manager of the nursing facility, David Levy, was not immediately available for comment. Rechnitz has not yet responded to a phone call or text message from the Journal. The California Lottery, meanwhile, hasn’t yet confirmed that the nurse’s ticket is the winning ticket.

ABC 7 reported that the nursing homes director confirmed that his employee is the Powerball winner, but does not know whether her winning ticket is the one bought by Rechnitz, or perhaps bought on her own.

Earlier this week, Nass said, Rechnitz bought just under 18,000 Powerball tickets (at $2 each), giving one to each of his employees and residents. He said that the winner was at the facility on Wednesday evening when her son texted her a picture of the winning ticket, which was purchased at a 7-Eleven in nearby Chino Hills. Nass then said that the nurse and her fellow employees broke out into joyful dancing.

“There were two nurses at the facility who witnessed her reaction,” Nass said. “Her kids proceeded to come by and pick her up to take her home.”

Each of the three winning Powerball tickets is worth $528.8 million before taxes. Florida and Tennessee don’t have state income taxes, and California exempts lottery winnings from what would be a 12.3 percent state income tax.

How much the potential Chino Hills winner receives depends on whether she would elect to receive one lump-sum payment ($187.2 million after taxes), or a 30-year annuity, which would provide significant tax savings because the lottery winnings Powerball invests isn’t taxed, while that same lump-sum after-tax money is taxed when invested by the winner.

Nass said that with each ticket came a note written by Rechnitz that read, “We’ll provide the ticket. You provide the dream.”

Rechnitz, 44, is a renowned philanthropist, particularly, but not solely, for Orthodox Jewish causes. He has donated millions of dollars, including $5 million to the indebted Mir Yeshiva in Jerusalem in Nov. 2011, $2.35 million to purchase a creditor’s note on the Chabad of California’s Westwood headquarters one month later, and $1 million to rebuild Orthodox Jewish schools damaged by Hurricane Sandy and to help the families whose children were at those schools. In April 2013 he bought the embattled Doheny Glatt Kosher Meats after its former owner, Mike Engelman, was videotaped bringing unidentified products into the store when the mashgiach (rabbinic kosher supervisor) was absent. The Rabbinic Council of California (RCC), which revoked Doheny Glatt’s kosher certification, approached Rechnitz about a possible purchase, amidst concerns that Doheny’s closure could significant impact the price of local kosher meat.

“The Rabbinical Council of California approached me and said, ‘Shlomo, could this be one of your charity things?’ “ Rechnitz recalled in an interview at the time with the Journal.

He writes $10,000 checks to families of police officers in Southern California who were shot on duty and, in November, during a layover at an airport in Shannon, Ireland, came across 400 U.S. soldiers and decided to give each one $50 so that they could purchase a good meal at the airport. A YouTube video of Rechnitz speaking to the uniformed soldiers went viral, so far accumulating nearly 650,000 views.

Rechnitz is also California’s largest nursing-home owner, with about 75 facilities ranging from as far south as San Diego to as far north as Eureka. Rechnitz got his start in the medical field in the late ‘90s, co-founding TwinMed—a medical supplies wholesaler—with his twin brother, Steve. Instead of selling nursing homes supplies by the item, he offered them a set daily rate for all supplies for each patient.

Rechnitz has since moved into the business of acquiring and managing dozens of nursing homes, but not without controversy. In 2014, Long Beach attorney Stephen Garcia filed a class-action lawsuit against one of Rechnitz’s company’s, Brius Management, which at the time owned 57 nursing homes in California, accusing the company of misrepresenting its quality of care, committing fraud and routinely violating industry regulations. Rechnitz’s attorney, Patricia Glaser, dismissed the lawsuit as baseless and said Garcia filed the lawsuit after Rechnitz denied him a consulting contract.

Also in 2014, the Sacramento Bee published an investigative series on nursing homes in California, particularly focusing on Rechnitz and ranking 35 of his nursing homes “below state averages” for quality of care, and marking them for performing worse than average in terms of nurse turnover, ratio of nurse aids, ratio of licensed vocational nurses, and ratio of registered nurses. The Bee determined that the nursing homes Rechnitz owned for all of 2014 had nearly triple as many “serious deficiencies” per 1,000 beds as the California average in 2014, according to data from the federal Centers for Medicare and Medicaid Services.

And in the same year, the California Attorney General Kamala Harris attempted to block Rechnitz’s purchase of 19 nursing homes, only to drop that injunction.

Last October, meanwhile, the FBI searched one of Rechnitz’s nursing homes in Riverside, the Alta Vista Healthcare & Wellness Centre. Laura Eimiller, a FBI spokeswoman, told the Journal in October that agents “were seeking evidence in an ongoing criminal investigation,” but not to remove any patients. Eimiller confirmed that the investigation is ongoing.

And in August, two former senior employees of the Mesa Verde Post Acute Care Center were charged with four misdemeanor counts of inflicting injury on an elder, and failing to report elder abuse. That same month Harris filed involuntary manslaughter charges against Verdugo Valley Skilled Nursing & Wellness Centre in Pasadena, criminally charging two nurses at the facility who they accused of “dependent-adult abuse” after an unstable 57-year-old resident walked unsupervised to a gas station, purchased a gallon of gasoline, and then lit herself on fire, dying at a local hospital the next day. A spokeswoman for Harris has not yet responded to a request for comment on the status of that case.

At the Mesa Verde nursing home, Rechnitz recently created and sponsors a wish-granting program for patients, providing, for example as recently described in a Los Angeles Times piece, a limousine ride and dinner for an elderly patient and his family.

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