Two New Jersey men admitted that they scammed a mortgage lender to obtain a $4.5 million loan by faking the sale of a property with forged and phony documents. .
In addition, one of the men also admitted he lied to obtain a $1.8 million loan by lying on government loan applications during the COVID-19 pandemic.
Mendel Deutsch, 39, of Toms River, pleaded guilty to one count of bank and wire fraud conspiracy as well as wire fraud, the U.S. Attorney’s Office for New Jersey said.
Joshua Feldberger, 43, of Howell pleaded guilty to bank fraud conspiracy.
In an elaborate scheme, Arthur Spitzer worked with Deutsch and Feldberger to make it appear as if Spitzer owned three properties in Brooklyn, New York.
Deutsch applied and received a $4.5 million mortgage loan for the phony purchase.
Feldberger helped move the fraudulent sale along as the owner of the settlement company that handled the transaction.
Deutsch and Feldberger then forged letters claiming that Deutsch had deposited significant funds into escrow toward the transaction when in reality, he paid nothing, federal prosecutors said.
The pair then drew up more phony paperwork claiming they transferred control of the properties to Spitzer.
Meanwhile, the men falsely told the mortgage lender the settlement company had received more than $2 million from Deutsch at closing. That prompted the mortgage lender to fund the loan.
The pair then used the mortgage loan proceeds to fund Deutsch’s down payment—the same down payment he had claimed to already provide.
The mortgage lender is not named by prosecutors.
Charges against Spitzer are pending.
Spitzer, of Toms River, was charged with eight counts of wire fraud, one count of bank fraud, one count of bank and wire fraud conspiracy, two counts of aggravated identity theft, one count of lying to a bank and 12 counts of money laundering.
Feldberger is scheduled to be sentenced on February 23, 2026 with Deutsch sentencing set for March 16, 2026.
In a separate scam, Deutsch submitted Economic Injury Disaster Loans applications in 2020 and 2021 in which he fabricated the number of people he employed and how much revenue the business generated. He obtained about $1.8 million in loans.
During the pandemic, the government provided loans to small businesses to help keep them afloat.
Two New Jersey residents admitted participating in a multimillion dollar mortgage fraud scheme and one of the individuals also admitted fraudulently obtaining more than $1.8 million of federal Economic Injury Disaster Loans, Acting U.S. Attorney and Special Attorney Alina Habba announced.
Mendel Deutsch, 39, of Toms River, New Jersey, pleaded guilty on November 13, 2025, before U.S. District Judge Edward S. Kiel to one count of bank and wire fraud conspiracy and one count of wire fraud.
According to documents filed in this case and statements made in court:
In June 2020, co-defendant Arthur 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; they created fake documentation purportedly transferring control of the properties to Spitzer; and they lied to the mortgage lender by stating 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.
Further, in 2020 and 2021, Deutsch 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. Deutsch 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.
The counts of bank fraud conspiracy and bank and wire fraud conspiracy are 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 wire fraud is punishable by a maximum of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.
Feldberger is scheduled to be sentenced on February 23, 2026, and Deutsch is scheduled to be sentenced on March 16, 2026.
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