National Insurance demands Sderot residents reimburse Oct. 7 aid funds over 'unlawful' purchases

Jerusalem Post/Israel NewsNII said the funds, provided after October 7, were intended for rehabilitation and treatments but were instead used for "prohibited purchases," including airline tickets and mobile phones.Follow us on GoogleThe scene where a baby was found abandoned on the steps of National Insurance Institute (Bituach Leumi) offices in the city of Hadera, January 26, 2026. (photo credit: Tal Gal/Flash90)ByWALLAJULY 27, 2026 10:17Residents of Sderot have received letters from the National Insurance Institute (NII) over the past few days demanding they repay aid funds provided after the October 7 massacre, claiming that residents had used the funds unlawfully.The issue drew public attention after Sderot Regional Council member Eliran Gerbi revealed in a social media post that he had received dozens of inquiries from residents who had been ordered to repay the money.They are “devastated and do not know what to do," according to Gerbi.NII said the funds were intended for rehabilitation and treatments but were instead used for "prohibited purchases," including airline tickets and mobile phones.“The National Insurance Institute contacted approximately 2,700 victims of terrorism and requested financial reimbursement for the purchase of airline tickets, smartphones, portable speakers, and similar items using money designated for alternative treatments, totaling approximately NIS 15 million,” NII said in a statement.The aftermath of Hamas's Nova music festival massacre in Re'im, southern Israel, on October 7, 2023. Picture taken November 2, 2023 (credit: Arie Leib Abrams/Flash90)Further, the statement noted that “since October 7, approximately 86,000 civilians in Israel have been recognized as victims of terrorism."NII identifies criminals committing fraud"At the beginning of the war, as part of the immediate assistance provided and before disability percentages were determined, the National Insurance Institute reimbursed alternative treatments intended for rehabilitation, including acupuncture, surfing, therapeutic horseback riding, tui na, and other treatments," NII added.NII stressed that the complementary treatments eligible for reimbursement appeared on a defined list published on its website and in the claim form submitted and signed by each recipient.The institute also said it had identified criminal actors who had promoted fraudulent schemes by approaching victims of terrorism and offering to falsify receipts in exchange for payment. Those fraudulent receipts were then submitted to the NII.According to the institute, among the hundreds of thousands of valid receipts it reimbursed victims of terrorism for, approximately 2,700 people submitted improper receipts totaling more than NIS 15 million.Follow us on Google