A Chicago-area rabbi, who formerly owned a nursing home chain at the heart of the biggest default in the history of a federal mortgage-guarantee program, has been indicted by federal authorities on charges he bilked millions of dollars from investors.
The indictment against Zvi Feiner and a business partner, Erez Baver, is the latest chapter in the yearslong saga involving the Rosewood Care Centers chain of nursing homes, which are mainly in the Chicago suburbs.
The $146 million default in 2018 was the worst ever for a program that insures mortgages on roughly 15 percent of the nation’s nursing homes. In the aftermath, the Department of Housing and Urban Development, which administers the mortgage guarantee program, tightened some of its underwriting and review processes.
The Rosewood chain — which has been renamed by the new owners — was part of a network of nursing homes that Mr. Feiner, 50, and Mr. Baver bought after raising money from investors in the Orthodox Jewish communities around Chicago and New York.
Federal authorities said the two men had misled investors about the financial health of the nursing homes and had run them as a Ponzi scheme, using money from new investors to pay