A New Jersey real estate investor admitted Monday that he was involved in a massive, far-reaching $54.7 million mortgage fraud scheme, federal prosecutors said.
Aron Puretz, 53, pleaded guilty to one count of conspiracy to commit wire fraud affecting a financial institution, according to a release from the U.S. Attorney’s Office District of New Jersey.
Between 2016 and 2022, Puretz and others not identified by officials, tricked lenders into issuing multifamily and commercial mortgage loans by providing them with phony documents. The faked papers included purchase contracts with inflated purchase prices, fake financial statements, and other fraudulent documents, the office said.
Puretz was an employee of Apex Equity Group, a Newark-based real estate investment and advisory firm, as well as being one of the owners of Maple Lawn in Eureka, Illinois, and Big Country Chateau in Little Rock, Arkansas, both multifamily properties, and Troy Technology Park in Troy, Michigan, a commercial property, authorities said.
He is listed as Apex’s president on the firm’s website. Nobody from the firm immediately responded to NJ.com’s request for a statement and inquiry about Puretz’s current standing with the company.
In February 2017, Maple Lawn was acquired for $4.1 million, but Puretz and his conspirators from Apex Equity Group utilized the identity of a unidentified conspirator to present a lender and Freddie Mac with a purchase and sale contract for $5.8 million and other fake documents, officials said.
On Feb. 17, 2017, a Lakewood-based title and settlement company, which was not identified by authorities, performed two closings, one for the true $4.1 million sales price and another for the fraudulent $5.8 million price presented to the lender, investigators said.
Part of the conspiracy was to create a nonprofit entity, JPC Charities, for the purpose of receiving tax-exempt status for the properties owned by Puretz and co-conspirators, the office said. Puretz and his conspirators provided false statements to the city of Eureka, Illinois, to receive a property tax exception.
In July 2019, Purtez and others acquired Big Country Chateau, however Puretz knew the lender and Freddie Mac would not approve him as an owner, and used the identity of an unnamed associate instead of his own, federal prosecutors said. Puretz hid his ownership and involvement with the property management company from the Department of Housing and Urban Development and other federal and state agencies.
The next year, in September, Troy Technology Park was acquired for $42.7 million and Puretz and his co-conspirators presented the lender with a fraudulent purchase and sale contract for $70 million, authorities said.
To support the inflated purchase price, they submitted to the lender and appraiser a fraudulent letter of intent to purchase the property from another party for $68 million and other fraudulent documents, officials said. To conceal the fraudulent nature of the transaction, Puretz and his conspirators arranged for a short-term $30 million loan, which was used to make it appear that they had the funds needed to close on the loan.
On Sept. 25, 2020, a Lakewood title and settlement company performed two closings, one for the true $42.7 million sales price and another for the phony $70 million sales price presented to the lender, the office said.
It was unclear if this was the same company that performed the closings in 2017.
Puretz is scheduled to be sentenced on Oct. 30, and faces a maximum penalty of five years in prison, according to officials.
Please consider supporting NJ.com with a voluntary subscription.
Chris Sheldon may be reached at csheldon@njadvancemedia.com.