On May 21, Mordichai Weiss of New York City, now 29, was convicted of one count of wire fraud in association with his activities on $230M in loans relating to multiple developments, including Greenbelt’s Charlestowne North. This outcome was the result of a plea agreement. Sentencing is anticipated shortly. Weiss owned Charlestowne North Holding Company, Inc., which had purchased the eponymous property in December 2022.
This result, however, will address only the damage to investors — but not the harm to residents of Charlestowne North, who endured significant impacts and stress as a result of the owner’s neglect of the building and blatant disregard for their rights. The owner siphoned out rental cash and failed to take care of the building or pay taxes and other fees and even took residents to court for nonpayment of rent after the building had been repossessed.
Proposed Action
City Manager Josué Salmerón is calling for the Maryland Attorney General’s office to seek restitution from Weiss on behalf of the affected tenants by filing suit under the consumer protection statutes. Several earlier News Review articles detail the tenant impacts (September 14, 2023; January 11, 2024; and January 18, 2024).
Asked if council had approved action, Salmerón said that the initiative for this call is his, rather than council’s, and he didn’t believe council approval was necessary to advocate for justice for the tenants. The form of any potential restitution was unknown. At this time, Salmerón believes “any justice for the residents would be better than no justice and no acknowledgement” — with the plea agreement offering neither. Though the city has neither the means nor the authority to seek civil or criminal penalties against Weiss, Salmeron hopes the State Attorney General has both at his disposal.
Fraud and Default
According to a Department of Justice (DOJ) press release dated May 21, U.S. Attorney Robert Frazer stated, “Weiss and his co-conspirators orchestrated an elaborate scheme built on falsified records designed to trick lenders into funding loans that never should have been approved.” DOJ goes on to say, “In total, Weiss obtained approximately $229.6 million in loans from multiple financial institutions through this scheme. Ultimately, he defaulted on the loans, or the loan balances substantially exceeded the value of the underlying collateral, resulting in approximately $94.4 million in losses to lenders, including the Federal National Mortgage Association, commonly known as Fannie Mae, and the Federal Home Loan Mortgage Corporation, commonly known as Freddie Mac.”
The press release notes that, “The sole count to which Weiss pled guilty carries a maximum penalty of 20 years’ imprisonment and a fine of up to $250,000, or twice the gross loss to the victim or gain to the defendant, whichever is greatest.”
The Property Today
Charlestowne North remains under the receivership of Tarantino Properties, appointed February 26, 2024 by the Prince George’s County Circuit Court, when the property was forfeited to lender Freddie Mac. Since that time, services to tenants have significantly improved and the property is stable (see the News Review March 6, 2024 issue). A follow-up in the December 26, 2024 issue notes that most problems had by that time been corrected although difficulties in procuring parts had delayed some elevator repairs. Current county tax records value the property at approximately $37M.
A Checkered Past
Charlestowne North started life enmired in controversy, as a product of developer Charles Bresler’s activities in the rapidly developing Greenbelt of the mid-1960s and in apparent contravention of then-current zoning laws. According to Salmerón, it has also never met building codes.
Charlestowne Village, including both the townhomes and the apartment building, was the topic of extensive negative and passionate articles in the News Reviews of that era (for example, June 16, 1966) complaining about developer encroachments and evasions.
Famously, a presumably much-riled Bresler later sued the News Review on a different pretext, leading to the landmark Supreme Court decision in which the News Review prevailed (see the May 21, 1970 issue).
