A “disreputable” New Jersey con man who was pardoned two years ago by former President Donald Trump has been arrested again and charged with defrauding investors out of millions of dollars.
Eliyahu “Eli” Weinstein and four other men are accused of defrauding more than 150 people out of $35 million in a “Ponzi-like scheme,” according to an arrest complaint unsealed Wednesday in federal court in Trenton and a declaration of the United States Attorney’s Office, District of New Jersey.
Using the alias Michael Konig, Weinstein and the others formed a company called Optimus Investments Inc. and allegedly began “orchestrating another substantial scheme to defraud investors” shortly after he was released from prison in January 2021, but is still on probation, according to the complaint.
“We allege that Mr. Weinstein participated in a new scheme to defraud investors by concealing his true identity,” said Special Agent in Charge James E. Dennehy of the FBI’s Newark field office. said in the Justice Department statement. “He knew that his actions were against the terms of his release from a prior conviction for investment fraud, and we allege that he engaged in criminal activity anyway.”
The group is accused of “falsely claiming” they had “lucrative deals” on Covid N95 masks, “baby formula in short supply” and “Ukrainian-bound first aid kits.”
Authorities say the men also conspired to hide Weinstein’s assets “that should have been used to pay more than $200 million in restitution” he owes victims of his previous Ponzi scheme.
Prosecutors say investigators obtained “surreptitious audio” recordings of meetings Weinstein attended with his alleged accomplices and two unidentified co-conspirators, beginning on August 26, 2022, during which he allegedly admitted he was using the alias Konig “because I have a bad reputation”. .”
Weinstein, 48, along with Aryeh Bromberg, 49, Joel Wittels, 57, Shlomo Erez, 55, and Alaa Hattab, 34, are charged with conspiracy to commit wire fraud and conspiracy to obstruct justice, according to the complaint.
If convicted on both counts, each of the five men faces up to 25 years in prison and fines of “$250,000 or twice the profit or loss from the crime, whichever is greater,” according to the court. Justice Department Statement.
All but Wittels, who like Weinstein and Bromberg live in Lakewood, New Jersey, and Hattab, who lives in Ottawa, Canada, have been arrested, according to the statement. Erez lives in Israel.
The unnamed co-conspirators, who ran a company called Tryon Management Group and were initially unaware that Weinstein was Konig, have not been charged, according to the complaint.
“Once Tryon’s owners learned that Mike Konig was actually Weinstein, they agreed with the defendants to continue to conceal Weinstein’s identity from investors and to raise additional money to pay off existing Tryon investors, all in an effort to prevent the Ponzi scheme from falling apart and to cover up the fraud,” the statement said.
The US Securities and Exchange Commission (SEC) also filed a civil lawsuit against Weinstein.
Weinstein was one of 74 people who received pardons from Trump in the final hours of his presidency in January 2021.
That group included former Trump chief strategist Steve Bannon, former Republican National Committee finance chairman Elliott Brody, Dwayne Michael Carter Jr. (aka rapper Lil Wayne) and Albert J. Pirro, Jr., the ex-husband of Fox News host Jeanine Pirro.
Weinstein, at the time, had served eight years of a 24-year sentence for his role in a $200 million real estate deal. ponzi scheme that he took advantage of other members of the Orthodox Jewish community in Lakewood, New Jersey, where he lives.
His commutation was supported by, among others, former US Attorney Brett Tolman, former Representative Bob Barr and defense attorney Alan Dershowitz.
At the time, then-New Jersey Attorney General Gurbir Grewal condemned Trump’s decision to pardon Weinstein.
“I am disgusted,” Grewal said, who had helped prosecute Weinstein. “It’s no surprise that President Trump grants Eli Weinstein clemency: he’s one huckster commuting someone else’s sentence.”
