I don't know the details of what is going on over in Beitar, but there is some serious investigation into the possibility of a municipal-controlled and funded modesty squad - vaad hatzniyut - that used violence to enforce its rules.
I have no comment on the issue in general at this point, except for on one point.
According to Bechadrei, when the mayor of Beitar Meir Rubinshtein along with Nissim Hadad, the person appointed by City Hall to deal with the local youth, was called in for questioning, after the police confiscated computers and servers from City Hall, Rubinstein said "How fortunate are we that we were caught on the words of the Torah".
Now, besides for that sounding like an admission of guilt - we were caught - I dispute that running a vaad hatzniyut to beat up kids who don't follow the rules is "caught on the words of the Torah". The Torah does not say to beat up kids for not dressing appropriately or for hanging out, even if they would be getting into trouble and frightening others, and using violence to bully them instead of either educating them and creating programs to interest them, or calling the police to deal with them if they are making trouble, is not Torah mandated.