Damian Williams, the United States Attorney for the Southern District of New York, announced that ELIEZER TILSON, a real estate promoter based in Israel, pled guilty to violating the Travel Act in connection with his embezzlement of $650,000 in investor funds.
U.S. Attorney Damian Williams said: “Investment fraud, like all financial crimes, has the potential to turn lives upside down and breed distrust in vital economic sectors. Eliezer Tilson took advantage of real estate’s integral role in the U.S. economy, admitting today to defrauding innocent victims who believed their investments were secure when, in fact, their money was being used to pay off debts and other victims. This Office will continue to keep a watchful eye on the markets and prosecute those attempting to deceive the investing public.”
According to the allegations contained in the Information:
In October 2019, TILSON solicited investments from two investors in New York City in an investment fund that focused on multifamily residential real estate projects. The two investors together sent $650,000 to TILSON for investment in the fund. TILSON never transmitted any of the victims' money to the fund. Instead, he used most of the money to pay dividends to other investors in separate, unrelated real estate projects and pay down prior debt incurred by other, unrelated entities.
When the victims first asked why their funds had not arrived at the investment fund, TILSON falsely assured them that the fund had their money. He later told the victims that he had arranged to send their money to the fund by wire transfer but that the wire had not yet gone through. He subsequently sent the victims a document purportedly from his bank showing a balance of more than $800,000 in his account when, in fact, that account was overdrawn. The next day, TILSON sent the victims a purported bank document falsely indicating that he had wired the first victim's money back to him and another purported bank document falsely indicating that his account had a balance of more than $400,000 when the account was overdrawn. TILSON admitted to the victims that he had taken their money a few days later to make other payments.
TILSON, 37, of Netanya, Israel, pled guilty to one count of violating the Travel Act, which prohibits the use of facilities in interstate and foreign commerce, including wire communications, to carry out unlawful activities such as engaging in monetary transactions in property derived from fraud in the sale of securities. It carries a maximum sentence of five years in prison.
The maximum potential sentence is prescribed by Congress and is provided here for informational purposes only, as the sentence will be determined by a judge.
Mr. Williams praised the outstanding investigative work of the Federal Bureau of Investigation.
This case is being handled by the Office’s White Plains Division. Assistant U.S. Attorney James McMahon is in charge of the prosecution.