NEW YORK (VINnews) — A large network of summer camps serving thousands of children, including many Jewish and Orthodox Jewish families, has filed for bankruptcy after defaulting on debt owed to investors in Israel.

Simad Holdings, controlled by brothers David and Michael Shabsels, sought Chapter 11 protection in New Jersey last week along with dozens of affiliated entities. The brothers also filed for personal bankruptcy protection. Court filings list liabilities ranging from $500 million to $1 billion.

The filing has sent shockwaves through the Jewish camping world because the Shabsels organization owns approximately 30 camps, including Camp Blue Star in North Carolina, Camp Lavi in Pennsylvania, Camp Achim in New York, SHMA Camps and several other overnight and day camps throughout the Northeast. Several of the camps cater primarily to Orthodox Jewish families and yeshiva communities and host thousands of campers each summer.

Despite the bankruptcy proceedings, camp officials have emphasized that summer operations will continue as planned. Representatives of several camps told media outlets that campers and parents should expect a normal summer season.

The financial crisis follows a $195 million bond offering in Israel completed late last year. The bonds were secured by a portfolio of camp properties and other assets. However, the company later disclosed that approximately $34 million had been transferred to entities controlled by the Shabsels brothers. When the funds were not returned, Simad defaulted on interest payments owed to bondholders.

According to reports by The Real Deal and eJewishPhilanthropy, the company subsequently came under scrutiny from Israeli regulators, who are examining potential securities law violations. Trading in the company’s bonds was suspended after their value plunged, and reports indicate Israeli authorities have launched an investigation into the company’s financial disclosures and transactions.

The brothers entered the camp business in 2006 and built one of the largest for-profit camping networks in the country. Unlike most Jewish camps, which operate as nonprofit organizations affiliated with Jewish denominations or community institutions, many of the camps owned by Simad are privately held for-profit enterprises.

Industry observers say the long-term future of some camps could depend on the outcome of the bankruptcy proceedings, particularly if creditors seek to sell camp properties as part of a restructuring plan. Under Chapter 11, however, operations can continue while the company reorganizes its finances and negotiates with creditors.

The bankruptcy filing comes at a time when demand for Jewish summer camp remains near record levels. Last summer, nearly 200,000 young people attended Jewish camps affiliated with the Foundation for Jewish Camp, underscoring the important role camp plays in Jewish education, identity and community building.

In addition to their camp holdings, the Shabsels brothers own office buildings, retail properties and other real estate assets. Reports indicate the organization controls roughly 80 properties nationwide.

The brothers have also been active in Jewish philanthropy and communal causes. David Shabsels has been listed among supporters of the Orthodox Union, while Michael Shabsels has served on the U.S. National Board of United Hatzalah. The family has hosted fundraising events benefiting Israeli and Jewish charitable organizations.

For now, camp directors insist preparations for the summer season are moving forward without interruption, even as the company faces one of the largest financial crises ever to hit the Jewish camping industry.