A Toms River man pleaded guilty Aug. 19 to orchestrating a multimillion-dollar mortgage fraud conspiracy and fraudulently obtaining more than $1.8 million in federal pandemic relief loans, U.S. Attorney Robert Frazer announced.
Arthur Spitzer, 39, entered the plea before U.S. District Judge Edward S. Kiel to one count of bank and wire fraud conspiracy and one count of money laundering. Spitzer, a registered Republican in Ocean County, faces up to 40 years in prison combined on the two counts.
Co-defendants Mendel Deutsch, 39, also of Toms River and a registered Republican in Ocean County, and Joshua Feldberger, 44, of Howell, who has no party affiliation and is registered to vote in Monmouth County, previously pleaded guilty to their roles and await sentencing.
According to court documents and statements made in court, Spitzer conspired with Deutsch and Feldberger in June 2020 to make it appear that Spitzer owned three properties in Brooklyn, New York, and agreed to sell them to Deutsch. Deutsch obtained a $4.5 million mortgage loan for the transaction.
Feldberger, who owned the settlement company handling the deal, facilitated the fraud, prosecutors said. The defendants fabricated letters claiming Deutsch had deposited significant funds into escrow, created fake documents purporting to transfer property control to Spitzer and made false statements to the mortgage lender that the settlement company had received more than $2 million from Deutsch at closing. The lender funded the loan, and the defendants used the proceeds to cover Deutsch’s down payment — which he had supposedly already provided.
Spitzer also agreed he was responsible for losses from five additional fraudulent loan schemes in 2019 and 2020, totaling more than $10 million.
Separately, in 2020 and 2021, Spitzer fraudulently obtained approximately $1.8 million in Economic Injury Disaster Loans from the U.S. Small Business Administration under the Coronavirus Aid, Relief, and Economic Security Act. The loans were intended for small businesses financially distressed by the COVID-19 pandemic.
Prosecutors said Spitzer submitted applications for businesses with little or no operations, including false statements about employee counts, revenues, cost of goods sold or lost rents. He later laundered some of the proceeds, authorities said.
The bank and wire fraud conspiracy count carries a maximum sentence of 30 years in prison and a $1 million fine, or twice the gross gain or loss from the offense. The money laundering count carries up to 10 years and a $250,000 fine, or twice the gross gain or loss.
Spitzer has agreed to pay full restitution, including $1 million to the true owner of the Brooklyn properties and at least $1,845,400 to the SBA, subject to credits for amounts already repaid. He also agreed to forfeiture totaling $2.35 million — $2.25 million for the bank and wire fraud conspiracy and $100,000 for money laundering of fraudulent EIDL proceeds.
Sentencing for Spitzer is scheduled for Dec. 21. Deutsch is scheduled for Oct. 6, and Feldberger awaits a new sentencing date.
The Federal Bureau of Investigation’s Atlantic City Resident Agency, the Internal Revenue Service-Criminal Investigation and the Federal Deposit Insurance Corporation-Office of the Inspector General conducted the investigation. Assistant U.S. Attorney Elisa T. Wiygul of the Camden office is prosecuting the case.
The Fraud Section of the Criminal Division leads prosecutions of schemes exploiting the Paycheck Protection Program. Since the CARES Act was enacted, the Fraud Section has prosecuted over 150 defendants in more than 95 criminal cases and seized over $75 million in fraud proceeds, according to the Justice Department.
On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division, which investigates and prosecutes fraud against the American public as part of the Trump administration’s Task Force to Eliminate Fraud, chaired by Vice President J.D. Vance.
Spitzer is represented by Henry Mazurek and Jason Ser of New York. Deutsch is represented by Timothy Sini, and Feldberger by Zach Intrater, both of New York.
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