Just before the holiday weekend, Attorney General Matthew Platkin announced the sentencing of two South Jersey men who pleaded guilty in February to a scheme that used bogus deeds to defraud real estate investors out of $580,000.
As NJBIZ reported in February, Richard Toelk Jr., 54, of Atlantic City (who also went by the alias “Richard Donato”), and his business partner, Keith Smith, 60, of Egg Harbor Township, accepted plea deals before their trial began.
An investigation revealed that from November 2018 through January 2019 the pair produced at least 20 fake deeds for real estate in Atlantic City and filed them with the Atlantic County Clerk’s Office. Investigators say that Toelk retained some for himself while marketing and selling others to investors in New York City and Philadelphia. However, most of the properties were actually owned by the Atlantic City municipal government while a handful were privately owned.
The AG’s office added that the land was not up for sale, and that the defendants lacked the authority and legal title to sell the properties.
The phony deeds purported to transfer the ownership of the various properties – sometimes for just a dollar each – from the rightful owners to limited liability companies owned by Toelk and Smith. One of those properties included a parcel owned by the city along the Atlantic City Boardwalk valued in excess of $1 million.
The bogus deeds were used to close on transactions with would-be, out-of-state real estate investors, who forked over that $580,000 sum thinking they were acquiring properties—when they were in fact gaining the title to nothing.
Platkin’s office says that earlier this month, following several unsuccessful motions to withdraw his guilty plea, Toelk was sentenced to a three-year prison term for theft by deception, in accordance with the previous plea agreement he reached with prosecutors.
Smith was also sentenced earlier this month to a non-custodial five-year probationary term.
The court also ordered the pair to be jointly liable for paying restitution to their victims in that aforementioned amount of roughly $580,000.
“Buyers placed their trust in these two defendants and handed over large sums of money to them, after being deceived by this elaborate fraud, complete with convincing-looking fake documents. But they were betrayed and taken advantage of,” said Platkin. “Through the work of the Office of Public Integrity and Accountability, this scheme unraveled. And through these plea agreements, the victims now have an opportunity to recover their losses.”
“These defendants manufactured an illegitimate paper trail and filed it with the county to make this charade seem believable,” said OPIA Executive Director Thomas Eicher. “They claimed public property as their own in order to line their pockets, victimizing their unwitting buyers and the Atlantic City government. These sentences are a just result.”