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Date: 03-19-2024
Case Style:
Case Number: 1:19-cr-00802
Judge: George B. Daniels
Court: The United States District Court for the Southern District of New York (Manhattan County)
Plaintiff's Attorney: The United States Attorney’s Office in New York City
Defendant's Attorney: Benjamin Brafman and Jacob Kaplan - 212-750-7800
Description:
Attorney And Former Bank Director Sentenced To 30 Months In Prison For Bank Fraud
MENDEL ZILBERBERG was sentenced today to 30 months in prison in connection with a scheme to obtain a fraudulent $1.4 million loan from Park Avenue Bank. The defendant was a member of Park Avenue Bank’s board of directors at the time of the offense. ZILBERBERG was previously found guilty following a one-week trial before U.S. District Judge George B. Daniels, who imposed today’s sentence.
U.S. Attorney Damian Williams said: “Those entrusted with the stewardship of financial institutions must uphold their responsibilities with integrity, not exploit their positions. Mendel Zilberberg’s manipulation of his roles as a legal practitioner and a director of Park Avenue Bank exemplifies a disturbing breach: one that led to a staggering loss for the institution. Safeguarding the integrity of our financial systems is imperative, and this Office will not tire in our mission to track down those who pose threats to this vital cornerstone of stability.”
According to the allegations contained in the Indictment, the evidence offered at trial, and matters included in public filings:
In or about 2009, ZILBERBERG conspired with a co-defendant, Aron Fried, and others to obtain a fraudulent loan from Park Avenue Bank (the “Bank”). Knowing that the co-conspirators would not be able to obtain the loan directly, the co-conspirators recruited a straw borrower (the “Straw Borrower”) to make the loan application. The Straw Borrower applied for a $1.4 million loan from the Bank on the basis of numerous lies, as directed by ZILBERBERG and his co-conspirators.
ZILBERBERG used his privileged position at the Bank to ensure that the loan was processed promptly. Based on the false representations made to the Bank and ZILBERBERG’s involvement in the loan approval process, the Bank issued a $1.4 million loan to the Straw Borrower, which was quickly disbursed to ZILBERBERG and his co-conspirators through multiple bank accounts and transfers. In total, ZILBERBERG received more than approximately $500,000 of the loan proceeds. The Straw Borrower received nothing from the loan and ultimately defaulted, resulting in a loss to the Bank of over $1 million.
On November 15, 2022, Fried pled guilty to conspiracy to commit bank fraud. On April 10, 2023, Judge Daniels sentenced Fried to one year and one day in prison.
Outcome:
Plaintiff's Experts:
Defendant's Experts:
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