- Luxury watch purchases
- High-risk stock and options trading
- Payroll for unrelated companies he controlled
By mid-July 2023, both corporate entities Schwartz had formed to manage the CrowdStreet investments filed for Chapter 11 bankruptcy, and investors were left with shattered portfolios and no completed projects.
What began in May 2022 as a high-promise venture quickly unraveled, exposing a web of financial misrepresentations, wire transfers, and personal enrichment that federal authorities labeled as classic wire fraud.
The Justice Department did not mince words following the sentencing.
“Schwartz’s greed was boundless,” said U.S. Attorney Theodore S. Hertzberg. “He callously abused the trust of hundreds of investors to line his own bank accounts, purchase expensive watches, and buy additional luxury items. Schwartz’s sentence reflects our office’s commitment to hold fraudsters accountable.”
“The defendant made fraudulent representations to investors and misappropriated their money,” added Matthew R. Galeotti, Head of the DOJ’s Criminal Division. “The Criminal Division remains dedicated to prosecuting fraudsters who steal investors’ hard-earned savings to the fullest extent of the law.”
FBI Atlanta Special Agent in Charge Paul Brown emphasized the lasting consequences: “Mr. Schwartz’s actions caused significant financial harm to hundreds of individuals. Today’s outcome delivers a measure of justice for the victims.”
In February 2025, Schwartz pleaded guilty to one count of wire fraud, a charge that carries significant penalties, especially when tied to large-scale financial crimes. The case was prosecuted by Trial Attorney Matthew F. Sullivanof the DOJ’s Fraud Section and Assistant U.S. Attorney Kelly Connors for the Northern District of Georgia.
The FBI’s Atlanta Field Office led the investigation, with valuable support from the U.S. Securities and Exchange Commission’s Division of Enforcement—highlighting the multi-agency effort it took to unravel the scheme and bring Schwartz to justice.
The Schwartz case underscores a growing risk in modern investment platforms: fraudulent actors hiding behind digital credibility. CrowdStreet, like many crowdfunding platforms, connects individuals to real estate opportunities that would otherwise require millions in capital and institutional backing. While democratizing investment, it also opens the door to new avenues for white-collar crime.
Legal analysts say this case should serve as a stark warning to investors: don’t mistake digital platforms for bulletproof investments. Conduct due diligence. Verify the legal entities receiving your funds. And always ask where your money is being held—and by whom.
Platforms like CrowdStreet operate as intermediaries, not fiduciaries, leaving investors vulnerable to fraudulent representations made by project sponsors.
With nearly seven years behind bars, Schwartz’s days of Rolexes and luxury real estate ventures are over—for now. But questions remain about how much of the stolen money can actually be recovered. Some experts believe restitution orders like Schwartz’s often fall short of returning investors to financial wholeness, especially when luxury assets are dissipated or hidden.
The bankruptcy filings of his two main entities will be monitored closely by creditor committees and trustees, who hope to recover whatever funds remain.
