New Jersey Real Estate Investor Pleads Guilty to Mortgage Fraud and Money Laundering
A New Jersey real estate investor has pleaded guilty to participating in a multimillion-dollar mortgage fraud scheme, fraudulently obtaining more than $1.8 million in federal COVID-19 relief loans, and laundering part of the proceeds.
According to the U.S. Attorney’s Office for the District of New Jersey, Arthur Spitzer, 39, of Toms River, pleaded guilty on August 19, 2026 before U.S. District Judge Edward S. Kiel to one count of bank and wire fraud conspiracy and one count of money laundering. His co-defendants, Mendel Deutsch and Joshua Feldberger, had previously pleaded guilty to their respective roles and are awaiting sentencing.
Mortgage scheme involved a $4.5 million loan
Prosecutors said that in June 2020 Spitzer conspired with Deutsch and Feldberger to make it appear that Spitzer owned three Brooklyn properties and had agreed to sell them to Deutsch. Deutsch then obtained a $4.5 million mortgage loan tied to the transaction, while Feldberger, as owner of the settlement company handling the deal, facilitated the closing.
The defendants created letters falsely stating that Deutsch had placed significant funds into escrow, prepared documentation purporting to transfer control of the properties to Spitzer, and represented to the mortgage lender that the settlement company had received more than $2 million from Deutsch at closing. In reality, prosecutors said, those funds had not been provided. The mortgage proceeds were then used to fund Deutsch’s supposed down payment.
Spitzer also accepted responsibility for losses arising from five additional fraudulent loan schemes carried out in 2019 and 2020. Those schemes caused losses of more than $10 million.
COVID-19 loan fraud and laundering
In 2020 and 2021, Spitzer also fraudulently obtained approximately $1.8 million in Economic Injury Disaster Loans intended to help small businesses affected by the COVID-19 pandemic. The government said he submitted applications for businesses with little or no operations and included false information about employee numbers, revenue, cost of goods sold or lost rents.
Spitzer admitted laundering some of the proceeds from the EIDL fraud. The Justice Department’s release does not provide a detailed transaction-by-transaction description of the laundering method, so no additional laundering mechanics have been inferred.
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. The money laundering count carries a maximum sentence of 10 years and a $250,000 fine, or twice the gross gain or loss.
Spitzer agreed to pay full restitution, including $1 million to the true owner of the Brooklyn properties and at least $1,845,400 to the Small Business Administration, subject to credits for amounts already repaid. He also agreed to forfeiture totaling $2.35 million: $2.25 million relating to the bank and wire fraud conspiracy and $100,000 relating to laundering of fraudulent EIDL proceeds.
Sentencing is scheduled for December 21, 2026. The investigation was conducted by the FBI, IRS Criminal Investigation and the FDIC Office of Inspector General.
The case illustrates how real-estate financing fraud and emergency-loan abuse can converge with laundering activity, particularly where fraud proceeds are subsequently moved or concealed through additional financial transactions.
