Sam Sprei, Ex-Judge Edward King Arrested Over $6.5 Million Escrow Fraud

6 articles · Updated · The Real Deal · May 13

$6.5 million in investor funds allegedly flowed into Edward King's escrow account after Sam Sprei pitched a Freehold, New Jersey bankruptcy-sale deal and said deposits were needed as proof of liquidity.
Prosecutors say the money was not held in escrow as promised: funds were moved out without investors' knowledge, including an $850,000 wire to an account in Sprei's name.
A public notice for the property listed a required escrow deposit of just $250,000, and investors recovered only $1.5 million through two wires in May 2025.
Sprei and King were arrested Tuesday morning and are due in federal court in Brooklyn; the wire-fraud conspiracy charge carries a maximum 20-year sentence.
King had already resigned earlier this year while under a judicial-conduct investigation tied to the allegations and to practicing law while serving as a judge.

With a history of fraud lawsuits, how did an investor manage to recruit a sitting judge for his scheme?

What systemic checks failed that allowed a judge's authority to be used for a multi-million dollar fraud?