Former Brooklyn Judge Charged in Multimillion Dollar Real Estate Scam

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

Former judge Edward Harold King, 72, and real estate investor Sam Sprei, 37, were arrested Wednesday morning on federal charges of wire fraud conspiracy. If convicted, they face up to 20 years in prison.

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

“Fraud that hides behind a veneer of legitimacy—especially the authority of a judge—strikes at the heart of public trust,” stated Internal Revenue Service Criminal Investigation (IRS-CI) New York Special Agent in Charge Harry T. Chavis Jr. 

Details of the alleged crime

“As alleged, the defendants stole millions of dollars from investors by cynically leveraging King’s position as a sitting judge to lend false legitimacy to supposed investment opportunities,” said U.S. Attorney 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 the abuse of public trust will always be a priority of our Office.”

Between November 2024 and May 2025, Sprei and King "solicited the victims’ funds in fictitious investment opportunities, represented to the victims that their invested funds would be returnable on demand if the victims decided to cease involvement in the investments, and then later refused to return the money based on false excuses and converted at least a substantial portion of the victims’ funds to their personal uses," alleges U.S. Department of Justice special agent Anthony Cunder in the criminal complaint.

According to the complaint, Sprei presented two investors the opportunity to purchase commercial real estate located in Freehold, NJ, through a bankruptcy court auction. Sprei said eligible bidders had to first show “proof of liquidity” by depositing funds in escrow.

Cunder says that Sprei made "numerous misrepresentations designed to deceive the Investors."

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

Sprei also told investors if they decided not to participate in any bid on the property, they could advise the escrow agent and would receive the full amount deposited within two business days, Cunder alleges in the complaint.

In addition, 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 authorization from the Investors."

Cunder says in the complaint that in February 2025, investors wired a total of approximately $6.5 million in escrow—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 wire transfers from the investors to the bank account in King’s name, Cunder alleges that millions of dollars of the investors’ funds were withdrawn or transferred to a bank account in Sprei’s name.

Real estate auction allegedly misrepresented

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

But Cunder says the notice did not identify King as an escrow agent, and that it set the required escrow deposit at only $250,000, rather than the much higher $6.5 million stated by Sprei to investors.

There is no evidence in the complaint that a property was ever bid on.

According to Cunder, the investors wrote to King in April 2025 requesting the return of their deposited funds—and King then provided false excuses as to why he could not return the $6.5 million. 

In May, Cunder says two wires in the amounts of $850,000 and $650,000, respectively, were sent from a bank account under the control of Sprei to the investors, representing a $1.5 million return of their $6.5 million investment.

Cunder says Sprei and King have not returned any further funds to the investors to date.

“IRS‑CI will relentlessly follow the money, expose deception, and ensure that those who manipulate and mislead investors are brought to justice," said Chavis. "Today’s arrests send a clear message: Schemes dressed up as opportunity will not shield wrongdoers from accountability.”