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DOCKET NO. HHD-CV23-6164067S : SUPERIOR COURT
:
FEDERAL NATIONAL MORTGAGE ASSOCIATION : JUDICIAL DISTRICT
: OF HARTFORD/NEW BRITAIN
V. : AT HARTFORD
:
GILLETT MARSHALL LLC, ABRAHAM DEUTSCH, :
AND GILLETT/MARSHAL CONDOMINIUMS :
ASSOCIATION, INC. : JANUARY 31, 2023
REVISED FORECLOSURE COMPLAINT
The plaintiff, Federal National Mortgage Association (“Plaintiff” or “Fannie Mae”), by its
attorneys, Windels Marx Lane & Mittendorf, LLP, for its Revised Foreclosure Complaint against the
defendants, hereby alleges as follows:
FIRST COUNT
1. Fannie Mae is a corporation organized and existing under the laws of the United States
with its principal place of business in Washington, D.C.
2. The defendant Gillett Marshall LLC (“Borrower”) is a Connecticut limited liability
company with an office and place of business, upon information and belief, at 50 Gillett Street, L01,
Hartford, CT 06105.
3. Borrower is the owner of those certain real property units with related property rights,
situated in the City of Hartford, County of Hartford, and State of Connecticut, located at 17 Marshall
Street/50 Gillett Street, being more particularly described on Schedule A, attached and incorporated
herein by this reference. Said real property units and related property rights, together with certain
other property and rights as defined in the Mortgage (as said term is hereinafter defined), are
hereinafter referred to collectively as the "Property."
4. Borrower executed and delivered to CBRE Multifamily Capital, Inc. (“CBRE”),
among other things, a certain Multifamily Note dated as of February 28, 2019 in the original
principal amount of $3,206,000.00 (the "Note") and a certain Multifamily Loan and Security
Agreement By and Between Gillett Marshall LLC and CBRE Multifamily Capital, Inc. dated as
of February 28, 2019 (the “Loan/Security Agreement”). Copies of the Note and Loan/Security
Agreement are attached as Exhibits A and B, respectively, and are incorporated and made a part
hereof by this reference.
5. To secure the Borrower's obligations to CBRE under the Note, Borrower executed in
favor of CBRE, among other things, (i) a certain Open-End Multifamily Mortgage, Assignment of
Leases and Rents, Security Agreement and Fixture Filing dated as of February 28, 2019 (the
“Mortgage”) and recorded in Volume 7452 at Page 119 of the City of Hartford Land Records (the
“Land Records”), granting to Plaintiff, among other things, a mortgage on the Property, and (ii) a
certain Uniform Commercial Code ("UCC") Financing Statement recorded on March 1, 2019 in
Volume 7452 at Page 139 of the Land Records (the “Financing Statement”). Copies of the Mortgage
and Financing Statement are attached as Exhibits C and D, respectively, and are incorporated and
made a part hereof by this reference.
6. Pursuant to a certain Assignment of Security Instrument dated February 28, 2019 and
recorded in Volume 7452 at Page 146 of the Land Records (the “Assignment”), CBRE assigned
and conveyed to Plaintiff all of its right, title and interest in and to the Mortgage. A copy of the
Assignment is attached as Exhibit E and is incorporated and made a part hereof by this reference.
7. On or about February 28, 2019, for good and valuable consideration
approximating the fair market value of the Note, CBRE endorsed in blank and delivered the
original Note to Plaintiff, which remains in possession thereof. As a result of the foregoing
Assignment and conveyances, Plaintiff is the current owner and holder of the Note, Mortgage,
Loan/Security Agreement, Financing Statement and any and all documents, agreements and/or
instruments of any kind whatsoever executed or delivered in connection therewith (said Note,
Mortgage, Loan/Security Agreement, Financing Statement and any and all documents,
agreements and/or instruments of any kind whatsoever executed or delivered in connection
therewith, sometimes hereinafter collectively referred to as the "Loan Documents"). Plaintiff is
also the holder in due course of the Note, under Connecticut General Statutes § 42a-3-302(a)(2),
since (i) the Note was conveyed and assigned to Plaintiff (a) for value, (b) in good faith, and (c)
without notice that the obligations under the Note were overdue or had been dishonored, or of
any defense against or claim to the Note on the part of any person, and (ii) Plaintiff did not
become a holder of the Note by purchase of the instrument at a judicial sale, by taking it under
legal process, by acquiring it via taking over an estate, or by purchasing it as part of a bulk
transaction not in regular course of business of the transferor.
8. Pursuant to Section 14.0l(a)(5) of the Loan/Security Agreement, an automatic
event of default shall occur thereunder upon, among other things, the “fraud, gross negligence,
willful misconduct, or material misrepresentation or material omission by or on behalf of
Borrower, Guarantor, or Key Principal or any of their officers, directors, trustees, partners,
members, or managers in connection with: (A) the application for, or creation of, the
Indebtedness; [or] (B) any financial statement, rent roll, or other report or information provided
to Lender during the term of the Mortgage Term….”
9. The Loan/Security Agreement further provides, among other things, that if an
event of default has occurred and is continuing, the entire unpaid principal balance of the Note,
any accrued regular interest, interest accruing at the default rate, the prepayment premium (if
applicable) and all other indebtedness, at the option of Plaintiff, shall immediately become due
and payable. Section 14.02(a).
10. The Mortgage also provides, among other things, that Borrower agrees to pay all
expenses and costs, including reasonable attorneys' fees and expenses, fees and out-of-pocket
expenses of expert witnesses and costs of investigation, incurred by Plaintiff as a result of any
event of default under the Loan/Security Agreement or in connection with efforts to collect any
amount due under the Loan Documents, or to enforce the provisions of the Loan/Security
Agreement or any of the other Loan Documents. Section 4.02(g).
11. By letter dated October 14, 2022 (the “10/14/22 Letter”), Plaintiff notified
Borrower, among others, that, among other things, based on the totality of the facts, admissions,
sworn statements, material statements and plea agreements made in the criminal cases United
States of America v. Jacob Deutsch (3:22-cr-00139-OAW) and United States of America v.
Aaron Deutsch (3:22-cr-00106-OAW) (collectively, the “Deutsch Criminal Cases”), Jacob
Deutsch and Aaron Deutsch (brothers of Abraham Deutsch), in connection with the Borrower’s
application for the mortgage loan and with specific intent to defraud CBRE and/or Plaintiff,
submitted fraudulent documents to CBRE and/or Plaintiff on behalf of, among others, Borrower
and Abraham Deutsch (as key principal of Borrower), including but not limited to, fraudulent
financial statements, rent rolls, utility bills and other information.
12. In the Deutsch Criminal Cases, Jacob Deutsch and Aaron Deutsch were charged
with conspiracy and fraud in the application process for twenty-four (24) loans (collectively, the
“Fraudulent Loans”) in the aggregate amount of $47,679,000.00, including the subject mortgage
loan memorialized by the Loan Documents. Jacob Deutsch and Aaron Deutsch have submitted
guilty plea agreements in the respective Deutsch Criminal Cases and are awaiting sentencing for
their crimes; copies of the Jacob Deutsch Plea Agreement and the Aaron Deutsch Plea
Agreement are attached hereto as Exhibits F and G, respectively.
13. The Jacob Deutsch Plea Agreement summarizes Jacob Deutsch’s criminal conduct in
perpetuating a scheme to defraud CBRE and Fannie Mae, among other parties, with respect to
the making of the Fraudulent Loans (including the subject loan), as follows:
Beginning in or around September 2016 and continuing through in or about May
2021, the defendant, JACOB DEUTSCH, in the District of Connecticut and elsewhere,
with the specific intent to defraud, conspired with others to devise and knowingly
participate in a scheme to defraud financial institutions, including CBRE Capital
Markets, Inc. ("CBRE"), Greystone Servicing Company, LLC ("Greystone"), Sachem
Capital Corp. ("Sachem"), and BSPRT CMBS Finance, LLC ("Benefit Street")
(collectively, the "victim financial institutions"), and to obtain money and property from
financial institutions by means of false and fraudulent pretenses, representations, and
promises, and to use the mail and wire communications in interstate commerce in
furtherance of that scheme.
In furtherance of the scheme and conspiracy, JACOB DEUTSCH and his co-
conspirators provided false information to (a) the victim financial institutions, (b)
government-sponsored enterprises Federal Home Loan Mortgage Company ("Freddie
Mac") and the Federal National Mortgage Association ("Fannie Mae"), and ( c) the
United States Department of Housing and Urban Development ("HUD"), in connection
with loans issued by the victim financial institutions and secured by various multifamily
housing properties managed by BHPM. The false information overstated the value of
multifamily housing properties managed by BHPM and induced the victim financial
institutions to issue loans that they otherwise would not have issued on the requested
terms, or for amounts larger than they would have authorized had they been provided
with truthful information. In addition, the false information induced Freddie Mac and
Fannie Mae to purchase the resulting loans from the victim financial institutions, and
induced HUD to issue a mortgage insurance commitment to a victim financial institution.
J. Deutsch Plea Agreement at P. 11.
14. The J. Deutsch Plea Agreement provides the following additional detailed
information as to how Fannie Mae, CBRE and the other victim financial institutions were
defrauded in the making of the Fraudulent Loans (including the subject loan):
JACOB DEUTSCH, his co-conspirators, and others employed various mechanisms to
mislead victim financial institutions regarding the properties' occupancy, an important
metric that appraisers and financial institutions use to value multifamily properties. For
example, JACOB DEUTSCH:
(1) provided false rent rolls to the victim financial institutions and appraisers by e-mail on
numerous dates, which either overstated the number of renters in a property by listing
fictitious renters or others not actually living there (including by listing BHPM
employees, without their knowledge), and/or falsely inflated the amount of rent paid by
occupants;
(2) deceived inspectors into believing that unoccupied apartments were, in fact, occupied,
including by staging the apartments with furniture and requiring BHPM employees to
wait in the unoccupied apartments during inspections and to falsely tell inspectors they
lived there;
(3) instructed BHPM employees to lie to inspectors if asked whether there were
vacancies in multifamily housing properties that BHPM had falsely represented as 100%
occupied;
( 4) e-mailed a victim financial institution doctored electric bills in the names of fake
tenants listed on false rent rolls;
(5) e-mailed a victim financial institution doctored gas bills in the names of fake tenants
listed on the false rent rolls;
(6) e-mailed victim financial institutions falsified leases in the names of fake tenants
listed on the false rent rolls;
(7) e-mailed a victim financial institution pictures of envelopes purporting to constitute
mail received by the fake tenants listed on the false rent rolls;
(8) e-mailed a victim financial institution a picture of a doctored invoice purporting to
reflect that a fake tenant had purchased furniture seen in a staged apartment by inspectors
during an inspection;
(9) e-mailed a victim financial institution pictures of money orders purporting to reflect
rent payments from fake tenants on falsified rent rolls as proof of payment of rent, when
in fact the money orders had been purchased by BHPM employees at the direction of
Aron Deutsch, or by Aron Deutsch;
(10) e-mailed a victim financial institution pictures of checks purporting to reflect rent
payments from fake tenants on falsified rent rolls as proof of payment of rent, when in
fact the checks had been purchased by Aron Deutsch; and
(11) e-mailed a victim financial institution pictures of stamped envelopes in which the
money orders and checks purportedly had been sent to the BHPM offices by fake tenants
on falsified rent rolls when, in fact, the envelopes had been filled out and mailed by
BHPM employees.
JACOB DEUTSCH, his co-conspirators, and others also employed various
mechanisms to mislead financial institutions regarding the properties' value in ways other
than by manipulating the occupancy rate. For example, JACOB DEUTSCH:
(1) provided the victim financial institutions false and inflated income statements and
financials for the properties;
(2) e-mailed victim financial institutions doctored bank statements purporting to reflect
greater operating income for the properties (and more liquidity of the alleged sponsor);
(3) e-mailed victim financial institutions doctored HUD-1 settlement statements, doctored
or forged purchase and sale agreements, and other documents to overstate the purchase
price of various multifamily housing properties when, in fact, the properties had been
purchased for lower purchase prices;
(4) provided victim financial institutions doctored and/or newly created invoices
purporting to reflect capital improvements made to various multifamily housing
properties when, in fact, the improvements had not been made, had not been performed
by the listed companies or individuals, and/or the costs had been grossly overstated; and
(5) provided victim financial institutions doctored checks purporting to substantiate the
purported capital improvements made to various multifamily housing properties when, in
fact, the improvements had not been made, had not been performed by the listed
companies or individuals, and/or the costs had been grossly overstated.
J. Deutsch Plea Agreement at P. 11-13.
15. The Aaron Deutsch Plea Agreement contains similar admissions by Aaron Deutsch
concerning his criminal conduct in connection with the Fraudulent Loans (including the subject
loan), as follows:
ARON DEUTSCH, his co-conspirators, and others employed various mechanisms
to mislead financial institutions regarding the properties’ occupancy, an important metric
that appraisers and financial institutions use to value multifamily properties. For example,
ARON DEUTSCH worked with [J. Deutsch] and directed BHPM employees to create
false rent rolls which (a) overstated the number of renters in a property by listing fictious
renters or others not actually living there (including by listing BHPM employees, without
their knowledge), and/or (b) falsely inflated the amount of rent paid by occupants. ARON
DEUTSCH knew [J. Deutsch] would send those false rent rolls to the victim financial
institutions and appraisers. ARON DEUTSCH also worked with [J. Deutsch] and
directed BHPM employees to deceive inspectors into believing that unoccupied
apartments were, in fact, occupied, including by staging the apartments with furniture,
requiring BHPM employees to wait in the unoccupied apartments during inspections and
to falsely tell inspectors the employees lived there, and requiring BHPM employees to
bring their own clothes into various apartments to make them look or appear “lived in.”
ARON DEUTSCH caused a BHPM employee to purchase money orders, purchased
money orders himself, and purchased checks himself, that purported to reflect rent
payments from fake tenants on falsified rent rolls as proof of payment of rent. ARON
DEUTSCH knew [J. Deutsch] would e-mail photographs of those checks and money
orders to a victim financial institution.
A. Deutsch Plea Agreement at P. 11-12.
16. The 10/14/22 Letter further notified Borrower that by virtue of, inter alia, the
submission of fraudulent financial information, other acts of fraud, as well as gross negligence,
willful misconduct, material misrepresentations or material omissions committed and/or made to
CBRE and/or Plaintiff in connection with the application for and creation of the mortgage loan in
breach of Section 14.0l(a)(5) of the Loan Agreement, certain events of default had occurred
under the Loan Documents.
17. By the 10/14/22 Letter, Plaintiff further, among other things, (i) notified Borrower
that as a result of the specified events of default under the Loan Documents, Plaintiff had
accelerated and declared the entire outstanding principal balance and all accrued interest under or
in connection with the Loan Documents, as well as any other amounts of any kind whatsoever
due, payable or outstanding thereunder, immediately due and payable; and (ii) made demand
upon Borrower for payment in full any and all amounts of any kind whatsoever due, payable,
owing or outstanding under or in connection with the Loan Documents within seven (7) days of
the date of such demand.
18. Notwithstanding the foregoing demand, Borrower failed, refused, and neglected to
pay to Plaintiff in full any and all amounts of any kind whatsoever due, payable, owing or
outstanding under or in connection with the Loan Documents. A breach has occurred under the
terms of the Loan Documents, and Plaintiff has been injured thereby.
19. As of October 1, 2022, the principal amount of $3,206,000.00 (exclusive of the
prepayment fee and other fees and expenses, including, without limitation, attorneys' fees and
costs and other charges) was due and owing to Plaintiff from Borrower under or in connection
with the Loan Documents. Interest continues to accrue under the terms of the Loan Documents
as set forth therein, and Plaintiff will continue to incur legal fees and expenses in connection
with this action.
20. On information and belief, the following encumbrances of record upon the
Property are prior in right to the Mortgage and are not affected by this action:
(i) Real property taxes and sewer charges to the City of Hartford, as the same may be
due and payable;
(ii) Affidavit of Facts dated January 9, 2019 and recorded in Volume 7437 at Page
148 of the Land Records;
(iii) Terms, conditions, covenants, easements, agreements, obligations, restrictions,
reservations, rights of way, rules and regulations and the by-laws of a Declaration
of Rose Estates at Gillett/Marshall Condominiums by Levaveinu LLC dated June
15, 2018 and recorded in Volume 7351 at Page 70 of the Land Records; and
(iv) Any common expense assessments, together with related fees and costs, due and
owing by the Borrower to Gillett/Marshal Condominiums Association, Inc. which
are entitled to priority pursuant to Connecticut General Statutes§ 47- 258(a).
21. Gillett/Marshal Condominiums Association, Inc. may claim an interest in the
Property for common expense assessments, together with related fees and costs, which are not
entitled to priority pursuant to Connecticut General Statutes§ 47-258(a). Said common expense
assessments, together with related fees and costs, are subsequent and subordinate to the lien and
interest of the Mortgage.
22. Borrower is the owner and holder of the Property.
23. The Mortgage is ineligible for emergency mortgage assistance as defined in Section 8-
265dd, et. seq. of the Connecticut General Statutes.
SECOND COUNT
1. – 23. Plaintiff hereby incorporates Paragraphs 1 through 23 of the First Count as
Paragraphs 1 through 23 of this Second Count as if fully restated herein.
24. Defendant Abraham Deutsch (“A. Deutsch”) is an individual with a place of
business at, upon information and belief, 15 Allen Place, Suite A2, Hartford, CT 06106.
25. For value received and to further induce CBRE to provide Borrower with the loan
evidenced by the Loan Documents, A. Deutsch executed a certain Guaranty of Non-Recourse
Obligations dated as of February 28, 2019 (the “Guaranty”) in favor of CBRE, pursuant to which
A. Deutsch, absolutely, unconditionally and irrevocably guaranteed the full and prompt payment
and performance when due, whether at maturity or earlier, by reason of acceleration or
otherwise, and at all times thereafter, of certain stated amounts, obligations and liabilities owed
under the Loan Documents, together with all costs and expenses, including reasonable fees and
out-of-pocket expenses of attorneys and expert witnesses, incurred by Lender in enforcing its
rights under the Guaranty (collectively, the “Guarantor Obligations”). A copy of the Guaranty is
attached hereto as Exhibit H and is incorporated and made a part hereof by this reference.
26. Plaintiff is the current owner and holder of, among other things, the Guaranty and
any documents, agreements and/or instruments of any kind whatsoever executed and/or delivered
in connection therewith.
27. Pursuant to the terms of the Guaranty, the Guarantor Obligations are due and
owing from A. Deutsch to Plaintiff.
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WHEREFORE, Plaintiff seeks the following remedies:
AS TO THE FIRST COUNT:
1. A strict foreclosure of the Mortgage as to the Property;
2. Immediate possession of the Property;
3. An order of immediate ejectment against Borrower with respect to the Property;
4. The appointment of a receiver of rents to manage and secure the Property and collect
the rents and profits accruing therefrom;
5. A deficiency judgment against Borrower, as applicable, pursuant to the Connecticut
General Statutes within the jurisdiction of the Court;
6. Costs, interest and attorneys' fees;
7. Damages; and
8. Such other and further equitable relief as may be required.
AS TO THE SECOND COUNT:
1. A judgment against A. Deutsch under the Guaranty pursuant to the Connecticut
General Statutes within the jurisdiction of the Court;
2. Costs, interest, and attorneys' fees; and
3. Such other and further equitable relief as may be required.
Dated at Stamford, Connecticut this 31st day of January, 2023.
THE PLAINTIFF,
FEDERAL NATIONAL MORTGAGE ASSOCIATION
By: ___________________________________
Jane W. Arnone
Connecticut Special Counsel for
Windels Marx Lane & Mittendorf, LLP
Its Attorneys
350 Bedford Street, Suite 201
Stamford, CT 06901
Juris No. 412149
Phone: (203) 324-9559
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DOCKET NO. HHD-CV23-6164067S : SUPERIOR COURT : FEDERAL NATIONAL MORTGAGE ASSOCIATION : JUDICIAL DISTRICT : OF HARTFORD/NEW BRITAIN V. : AT HARTFORD : GILLETT MARSHALL LLC, ABRAHAM DEUTSCH, : AND GILLETT/MARSHAL CONDOMINIUMS : ASSOCIATION, INC. : JANUARY 31, 2023 REVISED FORECLOSURE COMPLAINT The plaintiff, Federal National Mortgage Association (“Plaintiff” or “Fannie Mae”), by its attorneys, Windels Marx Lane & Mittendorf, LLP, for its Revised Foreclosure Complaint against the defendants, hereby alleges as follows: FIRST COUNT 1. Fannie Mae is a corporation organized and existing under the laws of the United States with its principal place of business in Washington, D.C. 2. The defendant Gillett Marshall LLC (“Borrower”) is a Connecticut limited liability company with an office and place of business, upon information and belief, at 50 Gillett Street, L01, Hartford, CT 06105. 3. Borrower is the owner of those certain real property units with related property rights, situated in the City of Hartford, County of Hartford, and State of Connecticut, located at 17 Marshall Street/50 Gillett Street, being more particularly described on Schedule A, attached and incorporated herein by this reference. Said real property units and related property rights, together with certain other property and rights as defined in the Mortgage (as said term is hereinafter defined), are hereinafter referred to collectively as the "Property." 4. Borrower executed and delivered to CBRE Multifamily Capital, Inc. (“CBRE”), among other things, a certain Multifamily Note dated as of February 28, 2019 in the original principal amount of $3,206,000.00 (the "Note") and a certain Multifamily Loan and Security Agreement By and Between Gillett Marshall LLC and CBRE Multifamily Capital, Inc. dated as of February 28, 2019 (the “Loan/Security Agreement”). Copies of the Note and Loan/Security Agreement are attached as Exhibits A and B, respectively, and are incorporated and made a part hereof by this reference. 5. To secure the Borrower's obligations to CBRE under the Note, Borrower executed in favor of CBRE, among other things, (i) a certain Open-End Multifamily Mortgage, Assignment of Leases and Rents, Security Agreement and Fixture Filing dated as of February 28, 2019 (the “Mortgage”) and recorded in Volume 7452 at Page 119 of the City of Hartford Land Records (the “Land Records”), granting to Plaintiff, among other things, a mortgage on the Property, and (ii) a certain Uniform Commercial Code ("UCC") Financing Statement recorded on March 1, 2019 in Volume 7452 at Page 139 of the Land Records (the “Financing Statement”). Copies of the Mortgage and Financing Statement are attached as Exhibits C and D, respectively, and are incorporated and made a part hereof by this reference. 6. Pursuant to a certain Assignment of Security Instrument dated February 28, 2019 and recorded in Volume 7452 at Page 146 of the Land Records (the “Assignment”), CBRE assigned and conveyed to Plaintiff all of its right, title and interest in and to the Mortgage. A copy of the Assignment is attached as Exhibit E and is incorporated and made a part hereof by this reference. 7. On or about February 28, 2019, for good and valuable consideration approximating the fair market value of the Note, CBRE endorsed in blank and delivered the original Note to Plaintiff, which remains in possession thereof. As a result of the foregoing Assignment and conveyances, Plaintiff is the current owner and holder of the Note, Mortgage, Loan/Security Agreement, Financing Statement and any and all documents, agreements and/or instruments of any kind whatsoever executed or delivered in connection therewith (said Note, Mortgage, Loan/Security Agreement, Financing Statement and any and all documents, agreements and/or instruments of any kind whatsoever executed or delivered in connection therewith, sometimes hereinafter collectively referred to as the "Loan Documents"). Plaintiff is also the holder in due course of the Note, under Connecticut General Statutes § 42a-3-302(a)(2), since (i) the Note was conveyed and assigned to Plaintiff (a) for value, (b) in good faith, and (c) without notice that the obligations under the Note were overdue or had been dishonored, or of any defense against or claim to the Note on the part of any person, and (ii) Plaintiff did not become a holder of the Note by purchase of the instrument at a judicial sale, by taking it under legal process, by acquiring it via taking over an estate, or by purchasing it as part of a bulk transaction not in regular course of business of the transferor. 8. Pursuant to Section 14.0l(a)(5) of the Loan/Security Agreement, an automatic event of default shall occur thereunder upon, among other things, the “fraud, gross negligence, willful misconduct, or material misrepresentation or material omission by or on behalf of Borrower, Guarantor, or Key Principal or any of their officers, directors, trustees, partners, members, or managers in connection with: (A) the application for, or creation of, the Indebtedness; [or] (B) any financial statement, rent roll, or other report or information provided to Lender during the term of the Mortgage Term….” 9. The Loan/Security Agreement further provides, among other things, that if an event of default has occurred and is continuing, the entire unpaid principal balance of the Note, any accrued regular interest, interest accruing at the default rate, the prepayment premium (if applicable) and all other indebtedness, at the option of Plaintiff, shall immediately become due and payable. Section 14.02(a). 10. The Mortgage also provides, among other things, that Borrower agrees to pay all expenses and costs, including reasonable attorneys' fees and expenses, fees and out-of-pocket expenses of expert witnesses and costs of investigation, incurred by Plaintiff as a result of any event of default under the Loan/Security Agreement or in connection with efforts to collect any amount due under the Loan Documents, or to enforce the provisions of the Loan/Security Agreement or any of the other Loan Documents. Section 4.02(g). 11. By letter dated October 14, 2022 (the “10/14/22 Letter”), Plaintiff notified Borrower, among others, that, among other things, based on the totality of the facts, admissions, sworn statements, material statements and plea agreements made in the criminal cases United States of America v. Jacob Deutsch (3:22-cr-00139-OAW) and United States of America v. Aaron Deutsch (3:22-cr-00106-OAW) (collectively, the “Deutsch Criminal Cases”), Jacob Deutsch and Aaron Deutsch (brothers of Abraham Deutsch), in connection with the Borrower’s application for the mortgage loan and with specific intent to defraud CBRE and/or Plaintiff, submitted fraudulent documents to CBRE and/or Plaintiff on behalf of, among others, Borrower and Abraham Deutsch (as key principal of Borrower), including but not limited to, fraudulent financial statements, rent rolls, utility bills and other information. 12. In the Deutsch Criminal Cases, Jacob Deutsch and Aaron Deutsch were charged with conspiracy and fraud in the application process for twenty-four (24) loans (collectively, the “Fraudulent Loans”) in the aggregate amount of $47,679,000.00, including the subject mortgage loan memorialized by the Loan Documents. Jacob Deutsch and Aaron Deutsch have submitted guilty plea agreements in the respective Deutsch Criminal Cases and are awaiting sentencing for their crimes; copies of the Jacob Deutsch Plea Agreement and the Aaron Deutsch Plea Agreement are attached hereto as Exhibits F and G, respectively. 13. The Jacob Deutsch Plea Agreement summarizes Jacob Deutsch’s criminal conduct in perpetuating a scheme to defraud CBRE and Fannie Mae, among other parties, with respect to the making of the Fraudulent Loans (including the subject loan), as follows: Beginning in or around September 2016 and continuing through in or about May 2021, the defendant, JACOB DEUTSCH, in the District of Connecticut and elsewhere, with the specific intent to defraud, conspired with others to devise and knowingly participate in a scheme to defraud financial institutions, including CBRE Capital Markets, Inc. ("CBRE"), Greystone Servicing Company, LLC ("Greystone"), Sachem Capital Corp. ("Sachem"), and BSPRT CMBS Finance, LLC ("Benefit Street") (collectively, the "victim financial institutions"), and to obtain money and property from financial institutions by means of false and fraudulent pretenses, representations, and promises, and to use the mail and wire communications in interstate commerce in furtherance of that scheme. In furtherance of the scheme and conspiracy, JACOB DEUTSCH and his co- conspirators provided false information to (a) the victim financial institutions, (b) government-sponsored enterprises Federal Home Loan Mortgage Company ("Freddie Mac") and the Federal National Mortgage Association ("Fannie Mae"), and ( c) the United States Department of Housing and Urban Development ("HUD"), in connection with loans issued by the victim financial institutions and secured by various multifamily housing properties managed by BHPM. The false information overstated the value of multifamily housing properties managed by BHPM and induced the victim financial institutions to issue loans that they otherwise would not have issued on the requested terms, or for amounts larger than they would have authorized had they been provided with truthful information. In addition, the false information induced Freddie Mac and Fannie Mae to purchase the resulting loans from the victim financial institutions, and induced HUD to issue a mortgage insurance commitment to a victim financial institution. J. Deutsch Plea Agreement at P. 11. 14. The J. Deutsch Plea Agreement provides the following additional detailed information as to how Fannie Mae, CBRE and the other victim financial institutions were defrauded in the making of the Fraudulent Loans (including the subject loan): JACOB DEUTSCH, his co-conspirators, and others employed various mechanisms to mislead victim financial institutions regarding the properties' occupancy, an important metric that appraisers and financial institutions use to value multifamily properties. For example, JACOB DEUTSCH: (1) provided false rent rolls to the victim financial institutions and appraisers by e-mail on numerous dates, which either overstated the number of renters in a property by listing fictitious renters or others not actually living there (including by listing BHPM employees, without their knowledge), and/or falsely inflated the amount of rent paid by occupants; (2) deceived inspectors into believing that unoccupied apartments were, in fact, occupied, including by staging the apartments with furniture and requiring BHPM employees to wait in the unoccupied apartments during inspections and to falsely tell inspectors they lived there; (3) instructed BHPM employees to lie to inspectors if asked whether there were vacancies in multifamily housing properties that BHPM had falsely represented as 100% occupied; ( 4) e-mailed a victim financial institution doctored electric bills in the names of fake tenants listed on false rent rolls; (5) e-mailed a victim financial institution doctored gas bills in the names of fake tenants listed on the false rent rolls; (6) e-mailed victim financial institutions falsified leases in the names of fake tenants listed on the false rent rolls; (7) e-mailed a victim financial institution pictures of envelopes purporting to constitute mail received by the fake tenants listed on the false rent rolls; (8) e-mailed a victim financial institution a picture of a doctored invoice purporting to reflect that a fake tenant had purchased furniture seen in a staged apartment by inspectors during an inspection; (9) e-mailed a victim financial institution pictures of money orders purporting to reflect rent payments from fake tenants on falsified rent rolls as proof of payment of rent, when in fact the money orders had been purchased by BHPM employees at the direction of Aron Deutsch, or by Aron Deutsch; (10) e-mailed a victim financial institution pictures of checks purporting to reflect rent payments from fake tenants on falsified rent rolls as proof of payment of rent, when in fact the checks had been purchased by Aron Deutsch; and (11) e-mailed a victim financial institution pictures of stamped envelopes in which the money orders and checks purportedly had been sent to the BHPM offices by fake tenants on falsified rent rolls when, in fact, the envelopes had been filled out and mailed by BHPM employees. JACOB DEUTSCH, his co-conspirators, and others also employed various mechanisms to mislead financial institutions regarding the properties' value in ways other than by manipulating the occupancy rate. For example, JACOB DEUTSCH: (1) provided the victim financial institutions false and inflated income statements and financials for the properties; (2) e-mailed victim financial institutions doctored bank statements purporting to reflect greater operating income for the properties (and more liquidity of the alleged sponsor); (3) e-mailed victim financial institutions doctored HUD-1 settlement statements, doctored or forged purchase and sale agreements, and other documents to overstate the purchase price of various multifamily housing properties when, in fact, the properties had been purchased for lower purchase prices; (4) provided victim financial institutions doctored and/or newly created invoices purporting to reflect capital improvements made to various multifamily housing properties when, in fact, the improvements had not been made, had not been performed by the listed companies or individuals, and/or the costs had been grossly overstated; and (5) provided victim financial institutions doctored checks purporting to substantiate the purported capital improvements made to various multifamily housing properties when, in fact, the improvements had not been made, had not been performed by the listed companies or individuals, and/or the costs had been grossly overstated. J. Deutsch Plea Agreement at P. 11-13. 15. The Aaron Deutsch Plea Agreement contains similar admissions by Aaron Deutsch concerning his criminal conduct in connection with the Fraudulent Loans (including the subject loan), as follows: ARON DEUTSCH, his co-conspirators, and others employed various mechanisms to mislead financial institutions regarding the properties’ occupancy, an important metric that appraisers and financial institutions use to value multifamily properties. For example, ARON DEUTSCH worked with [J. Deutsch] and directed BHPM employees to create false rent rolls which (a) overstated the number of renters in a property by listing fictious renters or others not actually living there (including by listing BHPM employees, without their knowledge), and/or (b) falsely inflated the amount of rent paid by occupants. ARON DEUTSCH knew [J. Deutsch] would send those false rent rolls to the victim financial institutions and appraisers. ARON DEUTSCH also worked with [J. Deutsch] and directed BHPM employees to deceive inspectors into believing that unoccupied apartments were, in fact, occupied, including by staging the apartments with furniture, requiring BHPM employees to wait in the unoccupied apartments during inspections and to falsely tell inspectors the employees lived there, and requiring BHPM employees to bring their own clothes into various apartments to make them look or appear “lived in.” ARON DEUTSCH caused a BHPM employee to purchase money orders, purchased money orders himself, and purchased checks himself, that purported to reflect rent payments from fake tenants on falsified rent rolls as proof of payment of rent. ARON DEUTSCH knew [J. Deutsch] would e-mail photographs of those checks and money orders to a victim financial institution. A. Deutsch Plea Agreement at P. 11-12. 16. The 10/14/22 Letter further notified Borrower that by virtue of, inter alia, the submission of fraudulent financial information, other acts of fraud, as well as gross negligence, willful misconduct, material misrepresentations or material omissions committed and/or made to CBRE and/or Plaintiff in connection with the application for and creation of the mortgage loan in breach of Section 14.0l(a)(5) of the Loan Agreement, certain events of default had occurred under the Loan Documents. 17. By the 10/14/22 Letter, Plaintiff further, among other things, (i) notified Borrower that as a result of the specified events of default under the Loan Documents, Plaintiff had accelerated and declared the entire outstanding principal balance and all accrued interest under or in connection with the Loan Documents, as well as any other amounts of any kind whatsoever due, payable or outstanding thereunder, immediately due and payable; and (ii) made demand upon Borrower for payment in full any and all amounts of any kind whatsoever due, payable, owing or outstanding under or in connection with the Loan Documents within seven (7) days of the date of such demand. 18. Notwithstanding the foregoing demand, Borrower failed, refused, and neglected to pay to Plaintiff in full any and all amounts of any kind whatsoever due, payable, owing or outstanding under or in connection with the Loan Documents. A breach has occurred under the terms of the Loan Documents, and Plaintiff has been injured thereby. 19. As of October 1, 2022, the principal amount of $3,206,000.00 (exclusive of the prepayment fee and other fees and expenses, including, without limitation, attorneys' fees and costs and other charges) was due and owing to Plaintiff from Borrower under or in connection with the Loan Documents. Interest continues to accrue under the terms of the Loan Documents as set forth therein, and Plaintiff will continue to incur legal fees and expenses in connection with this action. 20. On information and belief, the following encumbrances of record upon the Property are prior in right to the Mortgage and are not affected by this action: (i) Real property taxes and sewer charges to the City of Hartford, as the same may be due and payable; (ii) Affidavit of Facts dated January 9, 2019 and recorded in Volume 7437 at Page 148 of the Land Records; (iii) Terms, conditions, covenants, easements, agreements, obligations, restrictions, reservations, rights of way, rules and regulations and the by-laws of a Declaration of Rose Estates at Gillett/Marshall Condominiums by Levaveinu LLC dated June 15, 2018 and recorded in Volume 7351 at Page 70 of the Land Records; and (iv) Any common expense assessments, together with related fees and costs, due and owing by the Borrower to Gillett/Marshal Condominiums Association, Inc. which are entitled to priority pursuant to Connecticut General Statutes§ 47- 258(a). 21. Gillett/Marshal Condominiums Association, Inc. may claim an interest in the Property for common expense assessments, together with related fees and costs, which are not entitled to priority pursuant to Connecticut General Statutes§ 47-258(a). Said common expense assessments, together with related fees and costs, are subsequent and subordinate to the lien and interest of the Mortgage. 22. Borrower is the owner and holder of the Property. 23. The Mortgage is ineligible for emergency mortgage assistance as defined in Section 8- 265dd, et. seq. of the Connecticut General Statutes. SECOND COUNT 1. – 23. Plaintiff hereby incorporates Paragraphs 1 through 23 of the First Count as Paragraphs 1 through 23 of this Second Count as if fully restated herein. 24. Defendant Abraham Deutsch (“A. Deutsch”) is an individual with a place of business at, upon information and belief, 15 Allen Place, Suite A2, Hartford, CT 06106. 25. For value received and to further induce CBRE to provide Borrower with the loan evidenced by the Loan Documents, A. Deutsch executed a certain Guaranty of Non-Recourse Obligations dated as of February 28, 2019 (the “Guaranty”) in favor of CBRE, pursuant to which A. Deutsch, absolutely, unconditionally and irrevocably guaranteed the full and prompt payment and performance when due, whether at maturity or earlier, by reason of acceleration or otherwise, and at all times thereafter, of certain stated amounts, obligations and liabilities owed under the Loan Documents, together with all costs and expenses, including reasonable fees and out-of-pocket expenses of attorneys and expert witnesses, incurred by Lender in enforcing its rights under the Guaranty (collectively, the “Guarantor Obligations”). A copy of the Guaranty is attached hereto as Exhibit H and is incorporated and made a part hereof by this reference. 26. Plaintiff is the current owner and holder of, among other things, the Guaranty and any documents, agreements and/or instruments of any kind whatsoever executed and/or delivered in connection therewith. 27. Pursuant to the terms of the Guaranty, the Guarantor Obligations are due and owing from A. Deutsch to Plaintiff. [This space intentionally left blank] WHEREFORE, Plaintiff seeks the following remedies: AS TO THE FIRST COUNT: 1. A strict foreclosure of the Mortgage as to the Property; 2. Immediate possession of the Property; 3. An order of immediate ejectment against Borrower with respect to the Property; 4. The appointment of a receiver of rents to manage and secure the Property and collect the rents and profits accruing therefrom; 5. A deficiency judgment against Borrower, as applicable, pursuant to the Connecticut General Statutes within the jurisdiction of the Court; 6. Costs, interest and attorneys' fees; 7. Damages; and 8. Such other and further equitable relief as may be required. AS TO THE SECOND COUNT: 1. A judgment against A. Deutsch under the Guaranty pursuant to the Connecticut General Statutes within the jurisdiction of the Court; 2. Costs, interest, and attorneys' fees; and 3. Such other and further equitable relief as may be required. Dated at Stamford, Connecticut this 31st day of January, 2023. THE PLAINTIFF, FEDERAL NATIONAL MORTGAGE ASSOCIATION By: ___________________________________ Jane W. Arnone Connecticut Special Counsel for Windels Marx Lane & Mittendorf, LLP Its Attorneys 350 Bedford Street, Suite 201 Stamford, CT 06901 Juris No. 412149 Phone: (203) 324-9559