Elchonon “Elie” Schwartz has admitted guilt in a significant wire fraud case involving an investment scheme that misled over 800 investors. The fraudulent activities led to the diversion of approximately $62.8 million intended for commercial real estate projects, notably the Atlanta Financial Center on Peachtree Road.
Acting U.S. Attorney Richard S. Moultrie, Jr., stated, "Seeking to do nothing more than pad his own bank accounts and buy expensive luxury items, Elie Schwartz betrayed hundreds of investors who sought the opportunity to invest in these commercial real estate projects." He emphasized the commitment of his office to protect investors from such fraudulent schemes.
Sean Burke, Acting Special Agent in Charge of FBI Atlanta, commented on the impact of investment fraud: "Although investment fraud schemes are not violent crimes, they are just as destructive as they can destroy the livelihoods of entire families."
The court was informed that Schwartz operated a successful commercial real estate firm and began soliciting investments through CrowdStreet Marketplace starting in May 2022. Approximately $54 million was raised from 654 investors for the Atlanta Financial Center project. Another solicitation in November 2022 targeted a mixed-use building in Miami Beach called Lincoln Place, raising about $8.8 million from 167 investors.
Schwartz had agreements with CrowdStreet stipulating that funds would be held in segregated accounts and used solely for their intended investments. However, he diverted nearly all investor funds into personal accounts or unrelated ventures between June 2022 and June 2023.
These misappropriated funds were used by Schwartz for various personal expenses including payrolls for his businesses, luxury watches purchases, and stock market investments. By mid-July 2023, entities formed by Schwartz for receiving investor funds filed for Chapter 11 bankruptcy.
At age 46 and residing in New York City, Schwartz pleaded guilty to one count of wire fraud which carries a maximum sentence of up to 20 years imprisonment. Sentencing is set for May 19, 2025.
The Federal Bureau of Investigation leads this investigation with assistance from the Securities and Exchange Commission’s Division of Enforcement. Prosecutors include Assistant U.S. Attorney Kelly K. Connors and Trial Attorney Matthew F. Sullivan along with contributions from former Assistant U.S Attorneys David O’Neal and Christopher Huber.
For additional information regarding this case or other inquiries contact the U.S Attorney’s Public Affairs Office via email at USAGAN.PressEmails@usdoj.gov or phone at (404) 581-6280.