The chemical structure of organic matter has been shown to be only marginally important for its decomposability by microorganisms. The question of why organic matter does accumulate in the face of powerful microbial degraders is thus key for understanding terrestrial carbon and nitrogen cycling. Here we demonstrate, based on an individual-based microbial community model, that social dynamics among microbes producing extracellular enzymes ('decomposers') and microbes exploiting the catalytic activities of others ('cheaters') regulate organic matter turnover. We show that the presence of cheaters increases nitrogen retention and organic matter build-up by downregulating the ratio of extracellular enzymes to total microbial biomass, allowing nitrogen-rich microbial necromass to accumulate. Moreover, increasing catalytic efficiencies of enzymes are outbalanced by a strong negative feedback on enzyme producers, leading to less enzymes being produced at the community level. Our results thus reveal a possible control mechanism that may buffer soil CO2 emissions in a future climate.