The Department of Justice is sharpening its focus on yet another investor from Lakewood, in its ongoing nationwide pursuit of mortgage fraud. Eli Puretz could be next on DOJ’s indictment list if a plea agreement is not reached, as elucidated in a recently publicized transcript from a federal court hearing in New Jersey.
Accusations have been directed towards Eli Puretz for allegedly assisting his father, Aron Puretz, and Boruch Drillman in their plot to acquire a loan under false pretenses for an Michigan commercial property. The alleged scheme consisted of two transactions. Initially, Drillman bought the property at a lesser cost and subsequently resold it to Aron Puretz at a higher rate, the aim being to procure a larger loan.
Guilty pleas came from both Drillman in December and Aron Puretz just last month. The two face potential prison sentences that could span up to five years. Both individuals were accused of similar but separate schemes where fraudulent sales contracts were presented to loan agencies and either Freddie Mac or Fannie Mae, which allowed them to receive larger loans than they would have otherwise secured.
While the DOJ has yet to officially charge Eli Puretz, previously alleged to be an Apex Equity staff member, discussions for a plea agreement were initially underway. However, the tide turned as his hearing date in June was approaching, and he switched legal representatives. According to recent court hearing details, Trial Attorney Siji Moore of the U.S. DOJ’s Criminal Division’s Fraud Section has declared intent to indict Eli Puretz, via either a grand jury or a criminal complaint, in the absence of a guilty plea. The follow-up hearing is slated for July 16.
The court ruled that Aron Puretz is prohibited from discussing legal proceedings with his son. As of now, Eli Puretz’s legal representation has not responded to requests for comment.
In efforts to clamp down on fraud within the commercial mortgage sector, the DOJ and the Federal Housing Finance Agency have initiated cases nationwide where property owners have been found to furnish falsified financial or sales figures to lenders for loan procurement. The government sponsored enterprises Fannie Mae or Freddie Mac were often recipients of these loans. Freddie Mac has enacted stricter protocols for underwriting, effectively sidelining certain brokers and title insurance companies.
Further Reading
Unmasking the mortgage fraud exposing weaknesses in small-scale commercial lending
Guilty plea from NJ investor, Aron Puretz in fraud scheme worth $55M
Increased ties between Riverside and another fraudulent deal, call for deeper investigation
