2 NJ Men Admit to $4.5M Mortgage Fraud; One Also Guilty in $1.8M COVID Loan Scam

Two Ocean County men have pleaded guilty to federal charges tied to a multimillion-dollar mortgage fraud scheme, and one defendant also admitted to stealing $1.8 million in pandemic relief funds, Acting U.S. Attorney Alina Habba announced.

Mendel Deutsch, 39, of Toms River, pleaded guilty on Nov. 13 to bank and wire fraud conspiracy and wire fraud before U.S. District Judge Edward S. Kiel in Camden.

Joshua Feldberger, 43, of Howell, pleaded guilty on Oct. 22 to bank fraud conspiracy, also before Judge Kiel.

Fraudulent Mortgage Scheme

Prosecutors say the scheme unfolded in June 2020 and involved Arthur Spitzer, who allegedly worked with Deutsch and Feldberger to stage a fake real estate deal in Brooklyn.
Spitzer posed as the seller of three properties, while Deutsch acted as the buyer. Feldberger, who ran the settlement company, helped facilitate the transaction.

The trio allegedly created fake escrow letters, fabricated transfer documents, and false financial records to mislead a mortgage lender into approving a $4.5 million loan.
Investigators say Deutsch never made the down payment he claimed. Instead, the conspirators used the loan proceeds to fund the down payment themselves — creating a circular scheme designed to trick the lender.

COVID Relief Loan Fraud

Deutsch also admitted to securing roughly $1.8 million in Economic Injury Disaster Loans between 2020 and 2021 by submitting fraudulent applications under the CARES Act.

According to prosecutors, Deutsch applied on behalf of multiple businesses that had little or no real operations, inflating employee numbers, revenue, expenses, and rental income to qualify for the EIDL funds.

Possible Penalties

Each bank-fraud-related conspiracy charge carries a maximum of 30 years in prison and a $1 million fine, or twice the financial loss or gain.
The wire fraud count carries up to 20 years in prison and a $250,000 fine, or double the gain or loss.

Sentencing Dates

Joshua Feldberger: February 23, 2026
Mendel Deutsch: March 16, 2026

Investigators

The case was investigated by:

FBI Atlantic City Resident Agency
IRS–Criminal Investigation, Newark
FDIC Office of Inspector General, New York Regional Office

Assistant U.S. Attorneys Daniel A. Friedman and Elisa T. Wiygul are prosecuting the case.