CAMDEN, N.J. — A Toms River man has pleaded guilty in federal court to participating in a multimillion-dollar mortgage fraud scheme and separately defrauding the federal government out of more than $1.8 million through COVID-19 disaster relief programs, U.S. Attorney Robert Frazer announced.
Arthur Spitzer, 39, pleaded guilty on Aug. 19 before U.S. District Judge Edward S. Kiel to one count of conspiracy to commit bank and wire fraud and one count of money laundering. Prosecutors said the case involved fraudulent mortgage transactions exceeding $10 million and false applications for Economic Injury Disaster Loans (EIDL) created under the CARES Act.
Spitzer’s co-defendants, Mendel Deutsch, 39, and Joshua Feldberger, 44, previously pleaded guilty to their respective roles in the schemes and are awaiting sentencing.
- Federal prosecutors said Spitzer admitted responsibility for more than $10 million in fraudulent mortgage schemes.
- Authorities alleged he fraudulently obtained approximately $1.8 million in COVID-19 Economic Injury Disaster Loans.
- Spitzer agreed to pay millions in restitution and forfeit $2.35 million as part of his plea agreement.
Fake property sale secured $4.5 million mortgage
According to court documents and statements made in court, the conspiracy centered on a June 2020 transaction involving three properties in Brooklyn, New York.
Federal prosecutors said Spitzer, Deutsch and Feldberger created false documents making it appear Spitzer owned the properties and was selling them to Deutsch. Feldberger allegedly facilitated the closing through his settlement company.
Authorities said the defendants falsely claimed Deutsch had deposited substantial escrow funds and represented that more than $2 million had been received at closing. Those alleged misrepresentations caused the lender to approve and fund a $4.5 million mortgage loan.
Instead of using legitimate buyer funds, prosecutors said the defendants used the mortgage proceeds themselves to fund Deutsch’s required down payment.
Spitzer also admitted responsibility for losses resulting from five additional fraudulent loan schemes carried out during 2019 and 2020 totaling more than $10 million.
COVID relief funds obtained through false applications
Federal prosecutors also said Spitzer fraudulently obtained approximately $1.8 million through the Small Business Administration‘s Economic Injury Disaster Loan program.
The EIDL program was created under the CARES Act to provide emergency assistance to businesses financially impacted by the COVID-19 pandemic.
According to prosecutors, Spitzer submitted loan applications for businesses with little or no legitimate operations while falsely reporting employee counts, revenues, business expenses and lost rental income. Authorities also alleged he laundered portions of the fraudulently obtained loan proceeds after receiving the federal funds.
Restitution exceeds $2.8 million
As part of his plea agreement, Spitzer agreed to pay $1 million to the true owner of the Brooklyn properties and at least $1,845,400 to the Small Business Administration, subject to applicable repayment credits.
He also agreed to forfeit $2.35 million, including $2.25 million tied to the mortgage fraud conspiracy and $100,000 connected to laundering proceeds from the fraudulent EIDL loans.
The conspiracy charge carries a maximum sentence of 30 years in federal prison, while the money laundering charge carries a maximum penalty of 10 years. Sentencing is scheduled for Dec. 21.
The investigation was conducted by the Federal Bureau of Investigation, IRS Criminal Investigation and the Federal Deposit Insurance Corporation Office of Inspector General.
What did Arthur Spitzer plead guilty to?
Spitzer pleaded guilty to conspiracy to commit bank and wire fraud and one count of money laundering in connection with mortgage fraud and COVID-19 disaster loan fraud.
How much money was involved?
Federal prosecutors said the mortgage fraud schemes exceeded $10 million, while approximately $1.8 million in fraudulent Economic Injury Disaster Loans were also obtained.
When will he be sentenced?
Arthur Spitzer is scheduled to be sentenced in federal court on Dec. 21, 2026.
Sources: U.S. Attorney’s Office, Federal Bureau of Investigation, Small Business Administration, IRS Criminal Investigation
