I think that's probably correct. According to rumors I hear, the leadership of the community structures everything so that the rank and file will be poor and therefore entitled to the maximum amount of public assistance.

For example, suppose you teach 30 hours a week at the local religious school. In a free market, you might get paid $25k a year for this work and spend $10,000 a year to rent your nearby apartment. But if it's the same organization which runs the religious school and is also your landlord, you can have an arrangement with a nod and a wink in which you get paid only $15k a year and pay only $4k a year in rent for your apartment.

That way, you show much less income for purposes of taxes and government benefits. Technically this is fraud since you really should be reporting your effective rent subsidy as income. However it would be really difficult for the authorities to actually prove this is what is going on. Especially if all the important communications involved are in Yiddish.

Anyway, I don't know if this is what happens in KJ but I wouldn't be surprised at all if they have a million little scams like this going on.