Two men who pretended to be Atlantic City property sellers pleaded guilty to a scheme where they used bogus deeds to deceive and defraud real estate investors out of $580,000.
New Jersey Attorney General Matthew Platkin announced Feb. 9 that Richard Toelk Jr., 54, of Atlantic City, and his business partner, Keith Smith, 60, of Egg Harbor Township, accepted plea deals before their trial was set to begin.
After missing a court appearance in January, Toelk, who officials say was the primary orchestrator of the fraud, accepted a plea deal the next day, admitting to second-degree theft by deception.
Smith pleaded guilty to third-degree conspiracy.
The Attorney General’s Office says that an investigation revealed the pair produced at least 20 fake deeds for Atlantic City real estate, even filing them with the Atlantic County Clerk’s Office during a period between 2018 and 2019. They say that Toelk retained some properties for himself while marketing and selling others to unknowing investors in New York and Philadelphia.
Investigators found that most of the properties were owned by the Atlantic City municipal government while a handful were privately owned.
Even though the land was not for sale – and the pair had no legal authority to sell any of the parcels – they continued the scheme. Using the fake deeds, the duo purported to transfer ownership of the properties from the rightful owners to limited liability companies that they owned.
A property along the boardwalk worth more than $1 million was part of the scheme. That, too, was actually owned by the city.
Unfortunately, the unwitting out-of-town investors were bilked for an estimated $580,000, thinking they were picking up Atlantic City real estate. In reality, all they got was a fake deed and a lighter bank account.
“These investors spent hundreds of thousands of dollars and did not get what they bargained for,” said Platkin. “This was a lucrative scheme, with the scammers posing as the owners of what was, in fact, public property, some of which was along Atlantic City’s famous boardwalk. Their ruse, along with the paper trail manufactured to support it, were convincing enough that experienced real estate investors became victims.”
Thomas Eicher, executive director of the Attorney General’s Office of Public Integrity and Accountability, (OPIA), which spearheaded the investigation, said that this type of outright fraud, which victimized Atlantic City and the investors, cannot be tolerated and that the victims deserve to be made whole.
“This was a brazen scheme to fraudulently obtain title to properties belonging to Atlantic City, and then dupe unwitting investors into financing the bogus purchases,” said Eicher.
Both defendants agreed to joint liability for the full restitution.
Toelk will be sentenced on March 23 with prosecutors recommending a three-year prison term.
Smith will be sentenced on April 6 with prosecutors recommending probation, conditioned on his serving up to 364 days in the Atlantic County jail.