TOMS RIVER — A Toms River man has admitted his role in mortgage and pandemic-relief fraud schemes involving millions of dollars, federal prosecutors announced.
Arthur Spitzer, 39, pleaded guilty before U.S. District Judge Edward S. Kiel to conspiracy to commit bank and wire fraud and money laundering, according to U.S. Attorney Robert Frazer.
Federal prosecutors said Spitzer participated in a 2020 scheme involving three Brooklyn, New York, properties and a $4.5 million mortgage loan.
Authorities said Spitzer worked with Mendel Deutsch, 39, and Joshua Feldberger, 44, to falsely portray Spitzer as the owner of the properties and Deutsch as their buyer. Feldberger operated the settlement company involved in the transaction, prosecutors said.
The defendants allegedly produced documents falsely indicating that Deutsch had placed substantial money into escrow and that the settlement company had received more than $2 million from him at closing.
Those representations helped persuade the lender to release the mortgage funds, prosecutors said. Part of the loan proceeds was then used to cover the down payment Deutsch was purported to have already made.
Spitzer also accepted responsibility for losses tied to five other fraudulent loan transactions carried out in 2019 and 2020. Prosecutors said those schemes caused more than $10 million in losses.
Federal authorities said Spitzer separately obtained about $1.8 million through the Small Business Administration’s Economic Injury Disaster Loan program in 2020 and 2021.
The federal program was designed to assist businesses experiencing financial hardship during the COVID-19 pandemic. Prosecutors said Spitzer secured loans for businesses with little or no actual operations by providing inaccurate information about employees, revenue, expenses, cost of goods sold or lost rental income.
He also admitted laundering some of the fraudulently obtained disaster-loan money, authorities said.
Under his plea agreement, Spitzer agreed to pay restitution that includes $1 million to the actual owner of the Brooklyn properties and at least $1,845,400 to the SBA, with credit possible for money already repaid.
He also agreed to forfeit a total of $2.35 million — $2.25 million connected to the bank and wire fraud conspiracy and $100,000 related to laundering proceeds from the EIDL fraud.
The conspiracy charge carries a maximum penalty of 30 years in federal prison and a fine of up to $1 million, or twice the gross gain or loss from the crime. The money laundering charge carries up to 10 years in prison and a fine of as much as $250,000, or twice the gross gain or loss.
Spitzer is scheduled to be sentenced Dec. 21.
Deutsch and Feldberger have also pleaded guilty in connection with the schemes. Deutsch is scheduled for sentencing Oct. 6, while a new sentencing date for Feldberger has not yet been set.
The investigation was conducted by the FBI’s Atlantic City Resident Agency, IRS Criminal Investigation and the Federal Deposit Insurance Corporation’s Office of Inspector General.
Assistant U.S. Attorney Elisa T. Wiygul of the U.S. Attorney’s Office Criminal Division in Camden is prosecuting the case.
