The complaint says the alleged scheme began in 2018 and centered on flipping property contracts at inflated prices. According to the filing, a buyer would quickly transfer a contract to a related party at a much higher price, making a second sale appear real even though no money actually changed hands. Riverside allegedly acted as the closing agent and gave the transactions a legitimate appearance, allowing the participants to obtain larger loans and pocket the difference between the inflated financing and the true sale price.
One example cited in the suit involves the Park at Crestview property in Austin, Texas. It was bought in 2023 for $40.1 million, then assigned to a new buyer for $54 million. That inflated valuation led a lender to send $42 million to Riverside, Nosbaum and their partners, nearly $2 million above the real purchase price. The closing documents also allegedly included unusual charges, including $23,677 to Riverside, $138,685 labeled as brokerage fees for Fortune Capital Group even though it was not the broker, and $50,000 in legal fees to Nosbaum-Lewinger.
The plaintiffs say the deals depended on a constant flow of short-term bridge loans, and that the law firm used their escrow funds without permission to provide that financing. The filing says, “The scheme required a continuous supply of new lender deposits to operate,” because “each new closing was dependent on funds from the prior closing.”
The suit also alleges abuse of a U.S. tax rule that allows capital gains deferral if sale proceeds are held by a third party and reinvested in similar property. It says Nosbaum directed clients to Riverside, which instead loaned the money at 2% per month and paid Nosbaum 1% per month as a bribe. In a December 2021 text message cited in the complaint, Greenwald allegedly wrote, “I forgot what our deal was,” and Nosbaum replied, “One point a month, I think,” after which Greenwald confirmed Riverside was lending the money at 2% or more.
To conceal the profits, the defendants allegedly routed money through donations to charities at Greenwald’s direction, including Pomona Chassidic Community, Chabad Pomona, Or Shlomo, the Muncie Sabbath supporters group, the Expansion Fund and RCCS. In one instance, Greenwald reportedly asked that $5,000 be sent to RCCS, and a Riverside employee warned him not to have the charity send a thank-you letter or donation receipt, to avoid a paper trail that could look like a bribe. The complaint does not say whether the charities knew of the alleged scheme, and the defendants did not respond to requests for comment.
