Two Defendants Charged with Stealing or Misusing $20 Million in Supplemental Nutrition Assistance Program Benefits
Earlier today, in federal court in Brooklyn, Marat Lerner, the former president of a debt relief services business, pleaded guilty to one count of wire fraud conspiracy and one count of committing wire fraud while he was on pre-trial release. Lerner admitted that he lied to his victims and that he stole money that the victims had intended to use to pay off their home mortgages. The proceeding was held before United States District Judge Nicholas G. Garaufis. When sentenced, Lerner faces a maximum sentence of 50 years’ imprisonment. Lerner has also agreed to pay $2,554,217.11 in restitution. He was indicted in January 2023.
Breon Peace, United States Attorney for the Eastern District of New York, James Smith, Assistant Director-in-Charge, New York Field Office (FBI), and Thomas Fattorusso, Special Agent-in-Charge, New York Field Office, Internal Revenue Service – Criminal Investigations (IRS CI), announced the guilty plea.
“As he admitted today, Marat Lerner turned the victims’ American dreams into a nightmare by promising mortgage and debt relief, and instead preyed on their hard-earned life savings for his own personal gain,” stated United States Attorney Peace. “My Office will continue to protect immigrant communities against those who choose to use their positions of trust to defraud and steal from them.”
“Marat Lerner operated as an underground broker in his local community; but instead of completing his end of the bargain by paying their mortgages, he pocketed the money of his unsuspecting victims to live a life of luxury. This wasn’t just a money scam, this fraud affected his own community’s homes and families. Those who fell prey to Lerner’s deceit defaulted on their mortgage payments, and some fell into foreclosure. Today’s guilty plea and agreed restitution is just one step towards his victims getting justice, and his sentencing is the next,” stated IRS CI Special Agent-in-Charge Fattorusso.
According to court documents and facts presented at the guilty plea proceeding, Lerner was the owner of the “Lerner Group,” a business that claimed to provide debt relief services, including mortgage modifications, principally to the Eastern European immigrant community in Brooklyn. Many of the victims that the defendant defrauded were already experiencing financial hardship and had specifically sought Lerner’s assistance to help reduce their monthly mortgage payments. Lerner, in turn, promised that he could help them lower their monthly mortgage payments by working with their mortgage lenders to secure a mortgage loan modification or federal homeowner assistance. To carry out his fraud, Lerner instructed the victims that he needed access to their bank accounts so that he could directly transmit payments to the mortgage banks on the victims’ behalf, and that the payments would be addressed to either an escrow agent that would hold the funds until their mortgages had been modified, or to entities affiliated with their mortgage lenders. Lerner further instructed the victims not to contact their mortgage lenders directly and that he would serve as the liaison between the victims and the victims’ lenders.
In reality, Lerner stole over $2.5 million from the victims – money that the victims had intended to use to pay their mortgages. Once Lerner gained access to the victims’ bank accounts, Lerner transmitted funds from their accounts to companies and/or bank accounts that he himself controlled. Lerner kept the majority of the victims’ money, spending it on personal and business expenses, including a BMW, luxury goods, and expensive meals. To conceal his fraud, Lerner told the victims to disregard notifications from their mortgage lenders regarding delinquent payments and past due balances.
In January 2023, Lerner was indicted by a federal grand jury in the Eastern District of New York and arrested in connection with the above fraud. Pursuant to an order of the United States District Court for the Eastern District of New York, Lerner was released on bail and instructed, among other things, not to commit additional crimes. However, Lerner continued to steal from his victims even after being arrested for the same conduct. After his arrest in this case, between January 2023 and May 2023, Lerner stole at least $10,000 from his victims. Lerner’s bail was subsequently revoked.
As a result of Lerner’s years-long fraud, mortgage lenders have initiated foreclosure proceedings against several of the victims. As part of his guilty plea, Lerner has agreed to pay approximately $2,554,217.11 in restitution to the victims.
The government’s case is being handled by the Office’s Business and Securities Fraud Section. Assistant United States Attorneys Nicholas Axelrod and Genny Ngai are prosecuting the case with assistance from Paralegal Specialist Jacob Menz.
Brooklyn, New York
E.D.N.Y. Docket No. 23-CR-15 (NGG)
Danielle Blustein Hass
U.S. Attorney's Office