What Arthur Spitzer Did When the SBA Opened the COVID EIDL Window
- F.I. Editorial Team
- 5 days ago
- 3 min read
Quick Take: Arthur Spitzer, a 39-year-old real estate investor from Toms River, New Jersey, pleaded guilty this month to bank and wire fraud conspiracy and money laundering, admitting to a multimillion-dollar mortgage fraud scheme and to fraudulently obtaining roughly $1.8 million in COVID-era EIDL loans.
Defrauding a private mortgage lender in 2020 took Arthur Spitzer three people, a settlement company, forged escrow letters, and a fake real estate closing. Defrauding the federal government took him a loan application.
That gap, between what fraud used to cost and what the pandemic made it cost, is the real story in this plea. So instead of walking through it as one case, look at it as two ledgers kept by the same man.
Ledger one: the private fraud
The mortgage scheme, per the plea documents, was labor-intensive in the way fraud against professional lenders has to be. In June 2020, Spitzer and two co-conspirators, Mendel Deutsch and Joshua Feldberger, staged a transaction designed to look like Spitzer owned three Brooklyn properties and was selling them to Deutsch, who obtained a $4.5 million mortgage on the deal. Feldberger's settlement company handled the closing, which meant the conspiracy controlled the room where the money moved. The group produced letters claiming Deutsch had deposited substantial funds in escrow. He hadn't. They fabricated documents transferring the properties to Spitzer.
They told the lender the settlement company had collected more than $2 million from Deutsch at closing. It hadn't.
The lender funded, and the conspirators then used the loan proceeds themselves to cover the down payment Deutsch had supposedly already made, round-tripping the lender's own money to complete the illusion.
It worked, but notice everything it required: three participants with defined roles, a captive settlement agent, forged third-party documents, and a lender that at least demanded a closing, an escrow, and a paper trail worth faking. Spitzer also accepted responsibility for losses from five more fraudulent loan schemes in 2019 and 2020, which NBC10 Philadelphia reported totaled more than $10 million.
Ledger two: the government fraud
Now the COVID side, and watch how much shorter this section is.
In 2020 and 2021, Spitzer obtained approximately $1.8 million in Economic Injury Disaster Loans for businesses that had little or no actual operations. The method: applications with false statements about employee counts, revenues, cost of goods sold, and lost rents. Then he laundered some of the proceeds.
No co-conspirators were needed, because EIDL had no closing table. Unlike PPP, which at least routed applications through banks that could ask questions, EIDL was a direct-to-SBA program processed at pandemic speed on self-certified numbers. A fraudster who had spent 2019 and 2020 forging escrow letters to satisfy skeptical private lenders found a counterparty that asked for typed figures on a form. The SBA's own inspector general later estimated that more than $130 billion of COVID EIDL money was potentially fraudulent, dwarfing even PPP's estimated fraud losses, and cases like this one show why. The program paid out on the honor system, and people whose profession was dishonoring paperwork noticed.
More Than $1.8 Million Is Coming Back to the SBA
The financial consequences of Spitzer's plea are substantial.
Arthur Spitzer has agreed to pay at least $1,845,400 in restitution to the SBA, subject to credits for amounts already repaid. He also agreed to pay $1 million in restitution to the true owner of the Brooklyn properties.
His forfeiture agreement totals $2.35 million: $2.25 million connected with the bank and wire fraud conspiracy and another $100,000 tied to money laundering involving the EIDL proceeds.
The bank and wire fraud conspiracy count carries a maximum potential sentence of 30 years, while money laundering carries up to 10 years. Those are statutory maximums, not predictions of the sentence Spitzer will receive.
His sentencing is currently scheduled for December 21, 2026.
Co-defendants Deutsch and Feldberger have separately pleaded guilty to their roles in the broader schemes.
Sources: DOJ, U.S. Attorney's Office, District of New Jersey press release (Aug. 20, 2026); NBC10 Philadelphia (Aug. 22, 2026); SBA Office of Inspector General fraud estimates.
