Real estate investor admits mortgage fraud, COVID-19 relief program fraud schemes

Date: Aug. 20, 2026

Contact: newsroom@ci.irs.gov

Camden, NJ – A New Jersey man admitted to participating in a multimillion-dollar mortgage fraud scheme and fraudulently obtaining more than $1.8 million of federal Economic Injury Disaster Loans, United States Attorney Robert Frazer announced today.

Arthur Spitzer of Toms River, New Jersey, pleaded guilty on Aug. 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. Spitzer’s co-defendants, Mendel Deutsch and Joshua Feldberger, previously pleaded guilty before Judge Kiel to their respective roles in the fraudulent schemes and are awaiting sentencing.

According to documents filed in this case and statements made in court: 

In June 2020, Spitzer conspired with Deutsch and Feldberger to make it appear as if Spitzer owned three properties in Brooklyn, New York and agreed to sell them to Deutsch, who obtained a $4.5 million mortgage loan in connection with the transaction. Feldberger facilitated the fraudulent transaction as the owner of the settlement company that handled the transaction. The defendants created and sent letters stating that Deutsch had deposited significant funds into escrow toward the transaction, when in reality he had not; instead, they created fake documentation purportedly transferring control of the properties to Spitzer and made false statements to the mortgage lender by claiming that the settlement company had received more than $2 million from Deutsch at closing, which led the mortgage lender to fund the loan. The defendants then used the mortgage loan proceeds to fund Deutsch’s down payment, which he had supposedly already provided.

Spitzer also agreed that he was responsible for the losses resulting from five additional fraudulent loan schemes in 2019 and 2020, amounting to more than $10 million.

Further, in 2020 and 2021, Spitzer fraudulently obtained approximately $1.8 million of government loans that were intended for small businesses distressed by the COVID-19 pandemic. The Coronavirus Aid, Relief, and Economic Security (CARES) Act is a federal law enacted in March 2020 and was designed to provide emergency financial assistance to the millions of Americans who are suffering the economic effects caused by the COVID-19 pandemic. The CARES Act authorized the U.S. Small Business Administration (SBA) to provide Economic Injury Disaster Loans (EIDLs) of up to $2 million to eligible small businesses that were experiencing substantial financial disruption due to the COVID-19 pandemic. To obtain an EIDL loan, a qualifying small business was required to submit an application and provide information on its operations, including the number of employees and revenues or expenses. Spitzer obtained EIDL loans for businesses that had little or no operations by submitting loan applications that included false statements about the applicant companies’ number of employees, revenues, cost of goods sold, or lost rents. Spitzer then laundered some of the proceeds of the EIDL loan fraud. 

The count of bank and wire fraud conspiracy is punishable by a maximum of 30 years in prison and a $1,000,000 fine, or twice the gross gain or loss from the offense. The count of money laundering is punishable by a maximum of 10 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

Spitzer has agreed to pay full restitution to the victims of the offenses of conviction and relevant conduct, including $1,000,000 to the true owner of the Brooklyn properties, as well as at least $1,845,400 to the SBA, subject to any applicable credits for amounts already repaid to the victims. Spitzer also agreed to forfeiture in the amount of $2,250,000 as to the bank and wire fraud conspiracy and $100,000 as to the money laundering of fraudulent EIDL loan proceeds, for a total of $2,350,000.

Spitzer is scheduled to be sentenced on Dec. 21, 2026. Deutsch is scheduled to be sentenced on Oct. 6, 2026, and Feldberger is awaiting the scheduling of a new sentencing date.

U.S. Attorney Frazer credited special agents of the Internal Revenue Service – Criminal Investigation, under the direction of Special Agent in Charge Jenifer L. Piovesan in Newark; special agents of the Federal Bureau of Investigation’s Atlantic City Resident Agency, under the direction of Special Agent in Charge Stefanie Roddy in Newark; and special agents of the Federal Deposit Insurance Corporation – Office of the Inspector General, under the direction of Patricia Tarasca, Special Agent in Charge, New York Regional Office, with the investigation leading to these guilty pleas.

The government is represented by Assistant U.S. Attorney Elisa T. Wiygul of the U.S. Attorney’s Office’s Criminal Division in Camden.

The Fraud Section leads the Criminal Division's prosecution of fraud schemes that exploit the Paycheck Protection Program (PPP). Since the inception of the CARES Act, the Fraud Section has prosecuted over 150 defendants in more than 95 criminal cases and has seized over $75 million in cash proceeds derived from fraudulently obtained PPP funds, as well as numerous real estate properties and luxury items purchased with such proceeds.

On April 7, the Department of Justice announced the creation of the National Fraud Enforcement Division (“Fraud Division”). The Fraud Division is investigating and prosecuting those who commit fraud against the American people. The Department’s work to combat fraud supports President Trump’s Task Force to Eliminate Fraud, a whole-of-government effort chaired by Vice President J.D. Vance to eliminate fraud, waste, and abuse within Federal benefit programs.

IRS-CI is the law enforcement arm of the IRS, responsible for conducting financial crime investigations, including tax fraud, narcotics trafficking, money laundering, public corruption, healthcare fraud, identity theft and more. It is the only federal law enforcement agency with investigative jurisdiction over violations of the Internal Revenue Code. IRS-CI has 16 field offices located across the U.S. and maintains an international presence through attaché posts abroad.