New Jersey man, leader of a $200 million real estate fraud arrested

NEWARK, NEW JERSEY (BNO NEWS) – A Lakewood, New Jersey man was arrested on Thursday for being the leader of a real investment fraud scheme that caused losses of around $200 million, U.S. Attorney Paul J. Fishman announced.

Eliyahu Weinstein, aka “Eli Weinstein,” was arrested at his home and charged with one count of bank fraud and one count of wire fraud in connection with the alleged scam. A co-conspirator, Vladimir Siforov, 43, of Manalapan, New Jersey, was also charged but he is at large.

From September 2005 to date, Weinstein planned a real estate investment fraud scheme with the aid of Siforov and others. Weinstein targeted fellow members of the Orthodox Jewish community in New Jersey, New York, Florida, California and abroad. He used the social and business customs and practices of the community to perpetrate his scheme.

“Weinstein is charged with offering an array of lucrative investment opportunities that served the single purpose of fattening his wallet. It is always offensive when someone steals from others to finance his own luxurious lifestyle, but it is especially galling to exploit a community with whom one shares an inherent trust,” Fishman said.

The defendant and his allies lied to the victims in a variety of fraudulent means. For instance, Weinstein did not own all the properties he represented as his third-party buyers were often his own co-conspirators and sold his real or fake interest in a single property multiple times.

Weinstein also altered checks that were negotiated for small amounts in order that they appear as they have been issued for millions of dollars. In addition, the defendant drew up fraudulent leases to make it seem that a property had substantial rental income, when there was no tenant and no income. Material information that would dramatically reduce the value of the properties was often hidden too.

With his criminal proceeds, Weinstein purchased a substantial collection of art, jewelry and Judaica. The items include manuscripts and antique Judaica worth $6.2 million; two collections of jewelry and watches, which consists of items from Breguet, Bulgari, Cartier, Omega, Patek Phillippe, and Harry Winston, valued at $6.2 million and $7.6 million each.

Records from American Express revealed that the defendant was charged with approximately $1.7 million for transactions involving jewelers, art dealers and Judaica dealers. Weinstein stored his valuable collections in New Jersey, Florida and Israel.

If convicted, Weinstein faces a maximum potential penalty of 20 years in prison for the wire fraud charge. In realtion to the bank fraud charge, he faces a maximum prison term of 30 years.

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