Note: Picture for illustrations purposes only.
ATLANTA – May 19, 2025 — Elchonon “Elie” Schwartz, the head of a prominent commercial real estate investment firm, pleaded guilty today to one count of wire fraud in connection with a sweeping investment fraud scheme that bilked more than 800 investors out of approximately $62.8 million. The funds were raised for two major real estate projects — the Atlanta Financial Center and Lincoln Place in Miami Beach — but were instead misappropriated by Schwartz for personal use.
“Seeking to do nothing more than pad his own bank accounts and buy expensive luxury items, Elie Schwartz betrayed hundreds of investors who trusted him with their money,” said Acting U.S. Attorney Richard S. Moultrie, Jr. “This office remains committed to protecting investors from those who put personal greed ahead of financial integrity.”
FBI Acting Special Agent in Charge Sean Burke added: “Investment fraud may be non-violent, but its impact is devastating. Schwartz’s actions destroyed livelihoods and futures. He admitted to this scheme out of sheer greed and now must face the consequences.”
The Fraud Scheme
According to court records, Schwartz began soliciting investments in May 2022 through CrowdStreet, a popular real estate crowdfunding platform, raising:
- $54 million from 654 investors for the Atlanta Financial Center in Georgia
- $8.8 million from 167 investors for Lincoln Place, a mixed-use project in Florida
Despite signed agreements promising to keep investor funds in segregated accounts and use them solely for the identified developments, Schwartz diverted nearly all of the $62.8 million raised between June 2022 and June 2023. These funds were funneled into Schwartz’s personal bank and brokerage accounts, used to cover payroll expenses for his other ventures, purchase luxury watches, and invest in stocks and options.
Before either real estate transaction closed, the corporate entities created to receive the CrowdStreet funds filed for Chapter 11 bankruptcy in July 2023.
Sentencing and Fallout
Schwartz, 46, of New York, faces a maximum sentence of 20 years in federal prison. His sentencing is scheduled for 2:00 p.m. today before U.S. District Judge Steven D. Grimberg. Prosecutors are recommending a seven-year sentence, while Schwartz has requested probation — a request that has infuriated victims, many of whom are retirees, doctors, and small-business owners.
“I’d give back the $3,500 I recovered just to see him serve 20 years,” one investor told Bisnow, highlighting the fact that only about 13% of total funds have been recovered to date. Victims also pointed to Schwartz’s refusal to vacate an $18 million Manhattan penthouse as a sign of ongoing arrogance and disregard.
“He’ll just come out and do the same thing all over again,” said another investor. The judge may impose a harsher sentence if it is determined that Schwartz’s actions caused “substantial financial hardship” to his victims.
Case Background
The case is being investigated by the Federal Bureau of Investigation, with valuable assistance provided by the U.S. Securities and Exchange Commission’s Division of Enforcement.
Assistant U.S. Attorney Kelly K. Connors and Trial Attorney Matthew F. Sullivan of the DOJ Criminal Division’s Fraud Section are prosecuting the case. Former Assistant U.S. Attorneys David O’Neal and Christopher Huber also played key roles in the investigation and prosecution.
For further information, contact the U.S. Attorney’s Public Affairs Office at [email protected] or (404) 581-6280.
Official website: justice.gov/usao-ndga
