Monsey Attorney Convicted Of $1.4 Million Bank Fraud

MONSEY, NY — A former bank director who lives in Monsey conspired to steal $1.4 million through a fraudulent loan to a fake borrower at a time when the bank was in a "tenuous" state, according to Damian Williams, the United States Attorney for the Southern District of New York.

The Park Avenue Bank failed and was closed by regulators in 2010.

Apparently Mendel Zilberberg, an attorney, was not the only official of the bank using it for illegal gain. The former president of the bank, Charles Antonucci Sr. of Woodside, New York was found guilty in 2015 of a massive fraud scheme involving self-dealing, bank bribery, and embezzlement of bank funds.

A federal jury last week found Zilberberg, 65, guilty of conspiracy to commit bank fraud, which carries a maximum sentence of 30 years in prison; bank fraud, which carries a maximum sentence of 30 years in prison; conspiracy to make false statements to a bank, which carries a maximum sentence of five years in prison; making false statement to a bank, which carries a maximum sentence of 30 years in prison; and misapplying bank funds, which carries a maximum sentence of 30 years in prison.

"Mendel Zilberberg, while working as a practicing lawyer and serving as a director of Park Avenue Bank, ignored his duties and took advantage of the bank, viewing it as the object of his fraud scheme. Far from helping the bank through a tenuous moment in its existence, Zilberberg was focused on squeezing money out of it for himself, on the basis of lies. The bank collapsed just months after Zilberberg defrauded it," Williams said in announcing the verdict.

Sentencing is scheduled for Nov. 29 before U.S. District Judge George B. Daniels.

According to the allegations contained in the Indictment, the evidence offered at trial, and matters included in public filings:

In or about 2009, Zilbergerg conspired with Aron Fried and others to obtain a fraudulent loan from Park Avenue Bank. Knowing that the conspirators would not be able to obtain the loan directly, the conspirators recruited a straw borrower to make the loan application. The Straw Borrower applied for a $1.4 million loan from the bank on the basis of numerous lies directed by Zilberberg and his co-conspirators.

Zilberberg used his privileged position at the bank to ensure that the loan was processed promptly, prosecutors said. Based on the false representations made to the bank and his involvement in the loan approval process, the bank issued a $1.4 million loan to the straw borrower, which was quickly disbursed to the defendants through multiple bank accounts and transfers.

In total, Zilberberg received more than $500,000 of the proceeds. The remainder of the loan was split between Fried and another conspirator. The straw borrower received nothing from the loan. The loan ultimately defaulted, resulting in a loss of over $1 million.

On November 15, 2022, Fried pled guilty to conspiracy to commit bank fraud. On April 10, 2023, Judge Daniels sentenced Fried to one year and one day in prison.

Williams praised the outstanding investigative work of the Federal Bureau of Investigation and the Federal Deposit Insurance Corporation, Office of the Inspector General.

This case is being handled by the Office’s Complex Frauds and Cybercrime Unit. Assistant U.S. Attorneys Dina McLeod, Daniel G. Nessim, and Kimberly Ravener, with the assistance of Paralegal Specialist Joseph Carbone, are in charge of the prosecution.