NJ Men Plead Guilty in Scheme to Defraud Banks and Pandemic Relief Programs

Mendel Deutsch and Joshua Feldberger admitted to conspiring in a fraudulent $4.5 million mortgage transaction; Deutsch also confessed to illegally securing $1.8 million in pandemic relief loans.

Two Ocean County residents have pleaded guilty to federal charges in connection with a multimillion-dollar mortgage fraud scheme, and one of the defendants also admitted to fraudulently obtaining $1.8 million in federal COVID-19 relief loans, Acting U.S. Attorney and Special Attorney Alina Habba announced.

Mendel Deutsch, 39, of Toms River, pleaded guilty on November 13, 2025, to one count of bank and wire fraud conspiracy and one count of wire fraud before U.S. District Judge Edward S. Kiel in Camden federal court.

Joshua Feldberger, 43, of Howell, pleaded guilty on October 22, 2025, to one count of bank fraud conspiracy, also before Judge Kiel.

Fraudulent Mortgage Scheme

According to court documents and statements made during the proceedings, the mortgage fraud occurred in June 2020 and involved a co-defendant, Arthur Spitzer, who allegedly collaborated with Deutsch and Feldberger to fabricate a real estate transaction in Brooklyn, New York. Spitzer posed as the seller of three properties, while Deutsch posed as the buyer.

Feldberger, acting as the owner of the settlement company handling the transaction, helped facilitate the fraud. The co-conspirators allegedly created fake escrow letters, fraudulent property transfer documents, and false financial records to mislead a mortgage lender into approving a $4.5 million loan. In reality, Deutsch had not made the down payment claimed, and the loan proceeds were then used to fund the down payment itself—creating a circular, deceptive transaction.

Pandemic Relief Loan Fraud

In addition to the mortgage scheme, Deutsch admitted to fraudulently obtaining approximately $1.8 million in Economic Injury Disaster Loans (EIDLs) between 2020 and 2021. These loans were authorized under the CARES Act, passed in March 2020 to support small businesses facing economic disruption due to the COVID-19 pandemic.

Federal prosecutors say Deutsch submitted false information on behalf of several businesses, many of which had minimal or no actual operations. The applications included inflated or fictitious data on employee counts, revenues, costs, and lost rental income to secure the EIDL funds.

Potential Sentences and Legal Proceedings

• Each bank fraud conspiracy and bank and wire fraud conspiracy charge carries a maximum sentence of 30 years and a fine of up to $1 million, or twice the gross gain or loss from the offense.

• The wire fraud charge carries a maximum sentence of 20 years and a fine of up to $250,000, or twice the gross gain or loss.

Sentencing Dates:

• Joshua Feldberger is scheduled to be sentenced on February 23, 2026

• Mendel Deutsch is scheduled for sentencing on March 16, 2026

The investigation was conducted by agents from:

• The FBI’s Atlantic City Resident Agency

• IRS–Criminal Investigation, Newark

• The FDIC Office of Inspector General, New York Regional Office

The case is being prosecuted by Assistant U.S. Attorneys Daniel A. Friedman and Elisa T. Wiygul of the U.S. Attorney’s Office Criminal Division in Camden.

The charges against Arthur Spitzer remain pending. He is presumed innocent unless and until proven guilty.