Three real estate investors have recently pleaded guilty to their involvement in a $119 million mortgage fraud case. The guilty parties include two individuals from New York, Fredrick Schulman and Moshe “Mark” Silber, as well as one individual from New Jersey, Chaim “Eli” Puretz. This fraudulent scheme involved two multi-million dollar loans, one of which was with Fannie Mae, a government-sponsored enterprise that provides liquidity to the mortgage market.
According to court reports, Silber, Schulman, and Puretz collaborated on a deceptive scheme to deceive mortgage lenders. The illicit activities took place between 2018 and 2020, with Silber and Schulman operating under the guise of Rhodium Capital Advisors, a company supposedly involved in the acquisition and management of the Williamsburg of Cincinnati apartment complex in Ohio. Puretz, on the other hand, controlled Troy Technology Park in Michigan.
Silber and Schulman executed a scheme in March 2019 involving the purchase of Williamsburg of Cincinnati. They falsely inflated the purchase price to $95.85 million, despite the property’s actual sale price being $70 million. Through fraudulent means, they managed to secure a loan of $74.25 million from the lender and Fannie Mae based on the inflated price. Similarly, Puretz and his co-conspirators purchased Troy Technology Park in September 2020 for $42.7 million, but inflated the supposed acquisition price to $70 million. They submitted fraudulent documents to the lender and appraiser, resulting in a $45 million loan being funded.
The court has stated that Silber, Schulman, and Puretz could face up to five years in prison for each of the counts against them. Their sentencing is scheduled for December 3. This case serves as a stark reminder of the consequences of engaging in fraudulent activities within the real estate industry.
Mortgage fraud is a serious offense that can have far-reaching consequences for all parties involved. It not only damages the reputation of the individuals involved but also undermines the integrity of the real estate market as a whole. It is essential for investors and industry professionals to uphold ethical standards and adhere to legal regulations to maintain the trust and stability of the real estate sector.
In conclusion, the guilty pleas of Fredrick Schulman, Moshe “Mark” Silber, and Chaim “Eli” Puretz in the $119 million mortgage fraud case highlight the importance of transparency and honesty in real estate transactions. The repercussions of their actions serve as a cautionary tale for others in the industry, emphasizing the need for integrity and compliance with the law.