Former Brooklyn Judge Indicted for Millions in Real Estate Defraud

A former Kings County, NY judge, a Supreme Court justice and a Brooklyn real estate investor have been arrested and charged with perpetrating numerous schemes to defraud real estate investors of millions of dollars.

Former judge Edward Harold King72, and real estate investor Sam Bedspread37, were arrested Wednesday morning on federal charges of wire fraud conspiracy. If convicted, they face 20 years in prison.

Prosecutors say King and Sprei stole millions from investors through multiple schemes, including keeping the former judge as a trusted escrow provider for sham transactions.

“Fraud that hides behind a veneer of legitimacy – especially a judge’s authority – strikes at the core of public trust,” said the New York Special Agent in Charge of the Internal Revenue Service Criminal Investigation (IRS-CI). Harry T. Chavis Jr.

Details of the alleged crime

“As alleged, the defendants stole millions of dollars from investors by cynically using King’s position as a sitting judge to lend false legitimacy to purported investment opportunities,” said American lawyer Joseph Nocella Jr. “Today’s arrests demonstrate that this Office will hold accountable those who exploit victims for their own financial gain. Holding corrupt individuals accountable for abuses of public trust will always be a priority of our Office.”

Between November 2024 and May 2025, Sprei and King “solicited the victims’ money in fictitious investment opportunities, told the victims that their invested money could be returned upon request if the victims decided to discontinue their involvement in the investments, and later refused to return the money based on false excuses and diverted at least a significant portion of the victims’ money to their personal purposes,” a U.S. Department of Justice special agent alleges. Anthony Cunder in the criminal complaint.

According to the complaint, Sprei offered two investors the opportunity to purchase commercial real estate in Freehold, NJ, through a bankruptcy auction. Sprei said eligible bidders would first have to show “proof of liquidity” by depositing money into an escrow account.

Cunder says Sprei has made “numerous misrepresentations intended to mislead investors.”

According to Cunder, Sprei told the investors that their money would be held in escrow with a reputable third-party escrow agent.

Sprei also told investors that if they decided not to participate in an offer on the property, they could inform the escrow agent and receive the full deposited amount within two business days, Cunder alleges in the complaint.

Additionally, Cunder says Sprei told investors that “deposited escrow funds would not be used for any purpose or transferred out of escrow without the execution of further documentation and explicit consent from the investors.”

Cunder says in the complaint that in February 2025, investors transferred a total of approximately $6.5 million in deposits (approximately $5.5 million from Investor 1 and $1 million from Investor 2) to a bank account in the name of King, who Sprei told them was a New York judge.

In the days immediately following the transfers from the investors to the bank account in King’s name, Cunder claims that millions of dollars of the investors’ money was withdrawn or transferred to a bank account in Sprei’s name.

Real estate auction would have given a wrong representation

According to a report published in a national newspaper in January 2025, a legitimate public real estate auction was indeed scheduled for March 11, 2025.

But Cunder says the notice did not identify King as an escrow agent, and set the required bond at just $250,000, rather than the much higher $6.5 million Sprei had quoted to investors.

The complaint does not indicate that a bid was ever made on a property.

According to Cunder, the investors wrote to King in April 2025 asking for the return of their deposited money – and King then gave false excuses as to why he could not return the $6.5 million.

In May, Cunder says two payments worth $850,000 and $650,000 respectively were sent from a bank account controlled by Sprei to the investors, representing a $1.5 million return on their $6.5 million investment.

Cunder says Sprei and King have so far not returned any money to investors.

“IRS-CI will relentlessly monitor the money, expose fraud, and ensure that those who manipulate and deceive investors are brought to justice,” Chavis said. “Today’s arrests send a clear message: schemes dressed up as opportunities will not protect offenders from liability.”