In an investigation that originally surfaced in 2007 with the plea deal of a real estate magnate from Mahwah, Michael Eliasof, Federal investigators arrested another trio of men on conspiracy charges that netted them over two million dollars between 2002 thru 2005. One of those indicted was Gerald Carti who was reportedly living in Oakland at the time of his arrest but is listed as a resident of Fairlawn in the unsealed indictment. It is available to readers online as a PDF file.
According to reports, the scam offered easy money to investors seeking to buy into rental properties in Paterson. Offering depressed properties at inflated prices, investors were promised steady income from rental units with little effort and no involvement. What appeared to be ‘too good to be true’ actually was for those investors who exercised poor judgment. Appearing as reputable loan officers and realtors, the men are accused of providing false documents for loans that the investors could not repay.
The arrests came the same day as business reports announced that foreclosure rates in NJ had increased dramatically, especially in the neighboring counties of Passaic and Union. Foreclosure filings rose 11.2% in New Jersey in July 2008 as compared to July 2007. That equates to one filing for every 751 households in New Jersey. The increase nationwide was 55%, ranking NJ 19th in the nation.
Unlike the investors who lost savings in a scam centered on income generating properties, the vast majority of foreclosures nationwide deal with people losing their homes. The pandemic of foreclosures nationwide is being viewed as a natural disaster, and no indictments are expected in the near future.