TRENTON, NJ — A New Jersey real estate investor has pleaded guilty to helping carry out a multimillion-dollar mortgage fraud scheme tied to Brooklyn properties and to fraudulently obtaining more than $1.8 million in federal COVID-19 relief loans, according to U.S. Attorney Robert Frazer.
Arthur Spitzer, 39, of Toms River, entered the plea Wednesday to one count of bank and wire fraud conspiracy and one count of money laundering. Prosecutors said the case involves a June 2020 transaction in which Spitzer and two others made it appear that he owned three Brooklyn properties and had agreed to sell them, setting up a $4.5 million mortgage loan.
What Prosecutors Say
According to prosecutors and court filings, Spitzer worked with Mendel Deutsch and Joshua Feldberger, who are both awaiting sentencing. Feldberger owned the settlement company that handled the transaction. Officials said the defendants created letters showing Deutsch had placed large sums into escrow when he had not, and then used fake documents and false statements to convince the lender the closing had happened as described.
Prosecutors said the lender funded the mortgage after being told the settlement company had received more than $2 million from Deutsch at closing. The loan proceeds were then used to cover Deutsch’s supposed down payment, which prosecutors said had already been claimed in the paperwork. Spitzer also admitted responsibility for losses from five additional fraudulent loan schemes in 2019 and 2020, which totaled more than $10 million.
COVID Loan Fraud Details
Authorities said Spitzer separately obtained about $1.8 million in government-backed loans for small businesses during the pandemic in 2020 and 2021. Those loans were part of the Economic Injury Disaster Loan program authorized under the CARES Act and run by the U.S. Small Business Administration for eligible businesses facing serious disruption from COVID-19.
Prosecutors said Spitzer submitted applications for businesses with little or no activity and included false information about employees, revenue, cost of goods sold and lost rent. Officials also said he laundered some of the money tied to the EIDL fraud. Spitzer agreed to pay 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 any amounts already repaid.
Sentencing And Restitution
Spitzer also agreed to forfeit $2.35 million, including $2.25 million tied to the mortgage fraud conspiracy and $100,000 tied to laundering the EIDL proceeds. The bank and wire fraud conspiracy count carries a possible 30-year prison term and up to a $1 million fine, or twice the gross gain or loss from the offense. The money laundering count carries a possible 10-year sentence and up to a $250,000 fine, or twice the gross gain or loss.
Spitzer is scheduled to be sentenced on Dec. 21, 2026. Deutsch is set for sentencing on Oct. 6, 2026, and Feldberger is awaiting a new sentencing date. Court records in the case and statements made in court are the public records that lay out the allegations and the plea.
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