New York Man Pleads Guilty to $62.8 Million Investment Fraud Scheme Involving Atlanta Financial Center
Elchonon “Elie” Schwartz, 46, of New York, pleaded guilty today to wire fraud in connection with a large-scale investment fraud scheme that deceived more than 800 investors into sending approximately $62.8 million. Instead of using the funds for commercial real estate projects as promised, Schwartz diverted the money for personal expenses, including luxury watches, payroll for his businesses, and stock market investments.
According to prosecutors, Schwartz solicited investments beginning in May 2022 through the CrowdStreet Marketplace for the Atlanta Financial Center, a planned commercial real estate complex on Peachtree Road in Atlanta. He raised approximately $54 million from 654 investors. Later, in November 2022, he raised an additional $8.8 million from 167 investors for a mixed-use building in Miami Beach, Florida, known as Lincoln Place.
Schwartz falsely assured investors that their money would be kept in segregated bank accounts and used only for the intended real estate projects. However, between June 2022 and June 2023, he transferred nearly all of the funds to his personal bank and brokerage accounts, as well as accounts associated with his other business ventures. By mid-July 2023, both corporate entities tied to the projects filed for Chapter 11 bankruptcy.
“This office is committed to protecting investors from individuals, like Schwartz, who defraud donors out of their hard-earned money and seek to prioritize their own greed at the expense of legitimate investors,” said Acting U.S. Attorney Richard S. Moultrie, Jr.
Schwartz pleaded guilty to one count of wire fraud and faces a maximum penalty of 20 years in prison. His sentencing is scheduled for May 19, 2025, before U.S. District Judge Steven D. Grimberg.
The case was investigated by the FBI, with assistance from the Securities and Exchange Commission’s Division of Enforcement. Assistant U.S. Attorney Kelly K. Connors and Trial Attorney Matthew F. Sullivan are prosecuting the case.
