BULLETIN: $200 Million Ponzi And Affinty-Fraud Scheme Alleged By Feds In New Jersey; Eli Weinstein Arrested By FBI
UPDATED 2:40 P.M. EDT (U.S.A) The Newark Star-Ledger and the Asbury Park Press are reporting that New Jersey real-estate developer Eli Weinstein has been arrested by the FBI in a Ponzi and affinity-fraud case that may involve $200 million or more.
Both newspapers had photographers on the scene as the arrest was made this morning.
2:40 P.M. UPDATE: Weinstein is 35. He lives in Lakewood, N.J. Federal prosecutors, led by U.S. Attorney Paul J. Fishman, have issued a statement that describes the case as a Ponzi and affinity-fraud scheme targeting orthodox believers of the Jewish faith.
â€œWeinstein is charged with offering an array of lucrative investment opportunities that served the single purpose of fattening his wallet,” Fishman said. “It is always offensive when someone steals from others to finance his own luxurious lifestyle, but it is especially galling to exploit a community with whom one shares an inherent trust.â€
A veteran FBI agent said the scheme was contemptible.
â€œBased on the allegations in the criminal complaint â€“ lies, threats, deliberate misrepresentations, and even counterfeit checks, it is clear to us that the defendants in this matter exploited the close community ties of the Orthodox Jewish Community for one goal: to steal money through an elaborate real estate and Ponzi scheme,â€ said Michael B. Ward, special agent in charge of the Newark division.
â€œThis investigation highlights the need for consumers to do their own homework before entering into any business arrangements and not simply take the word of the other partners,” Ward continued. “If something seems too good to be true, it almost always is.”
Ward credited the IRS for assisting in the probe, saying its role was important in unmasking the scheme.
“At its most basic level, this is a case about greed and the abuse of trust,” Ward said. “The subjects in this case did not utilize overly sophisticated fraud schemes, but rather took advantage of trusted relationships to persuade victims to invest in their staged real estate ventures, which were often supported by false and forged documents.â€
Also charged in the case was Vladimir Siforov, 43, of Manalapan, N.J. He “remains at large,” prosecutors said.
Read the Asbury Park Press coverage at APP.com.
Weinstein’s New Jersey Ponzi arrest was the second in the state in recent months to allegedly involve a spectacular sum of money.
Nevin J. Shapiro, 41, of Miami Beach, Fla., was arrested in New Jersey in April on charges of running an $880 million Ponzi scheme involving a bogus wholesale grocery business.
The alleged Weinstein and Shapiro schemes combined may involve more than $1 billion.