Four former real estate investors were sentenced on April 1 for their roles in a multi-year conspiracy to defraud financial institutions by obtaining fraudulent loans on multifamily properties.
The sentences included both prison time and substantial financial restitution, with Aron Puretz, 53, of New Jersey, and his son, Chaim “Eli” Puretz, 29, of New Jersey, receiving 60 months and 24 months prison time, respectively. They were also ordered to pay $22,235,457 and $20,315,457 in restitution, respectively.
Meanwhile, Moshe “Mark” Silber, 34, of New York, and Fredrick Schulman, 72, of New York, were also sentenced to terms of imprisonment for their respective roles in a conspiracy to commit wire fraud affecting a financial institution. Silber was sentenced to 30 months in prison, while Schulman was sentenced to 12 months and a day in prison, to be followed by nine months of home confinement.
The amounts Silber and Schulman will pay in restitution will be determined at a later hearing.
Between 2018 and 2020, Silber, Schulman, and Eli Puretz worked with others to trick lenders into giving a mortgage loan for a multifamily property and to have Fannie Mae fund or buy the mortgage loan. Silber and Schulman were managing members of Rhodium Capital Advisors, which managed Williamsburg of Cincinnati, an apartment complex. Eli and Aron Puretz owned Troy Technology Park in Troy, Mich.
According to court documents, the defendants provided lenders and Fannie Mae with fake documents, including a purchase contract with a higher price and other fraudulent papers.
In March 2019, Williamsburg of Cincinnati was bought for $70 million. However, the conspirators used a stolen identity to present a contract showing a price of $95.85 million. On March 8, 2019, they held two closings: one for the real price of $70 million and another for the fake price. Because of their lies, the lender and Fannie Mae funded a loan of $74.25 million.
In September 2020, Puretz and others bought Troy Technology Park for $42.7 million but submitted false documents to support an inflated price of $70 million. They also arranged a short-term loan to cover the difference, completing two closings for both prices.
Matthew R. Galeotti, head of the Justice Department’s Criminal Division; Interim U.S. Attorney Alina Habba for the District of New Jersey; Inspector General Brian M. Tomney of the FHFA-OIG; Postal Inspector in Charge Eric Shen of the USPIS Criminal Investigations Group; and Acting Inspector General Stephen M. Begg of the HUD-OIG made the sentencing announcement.
Trial Attorney Siji Moore of the Criminal Division’s Fraud Section and Assistant U.S. Attorney Martha Nye for the District of New Jersey are prosecuting the case.