Federal prosecutors and the FBI in New York are investigating Arbor Realty Trust over its lending practices and loan book. The probe, which also involves the DOJ, follows allegations of fraudulent activities, including undisclosed related party deals and misrepresentation of loan values. Arbor has been accused of concocting a fraudulent scheme on West Chase and faces scrutiny from short sellers like Viceroy Research. The investigation comes amid a broader crackdown on commercial real-estate fraud, driven by falling property values and rising defaults. Arbor has not commented on the ongoing investigations. The situation involves multifamily properties.