Group charged with massive mortgage fraud

DETROIT, June 17 (UPI) -- Federal prosecutors say a group in the Detroit area ran a mortgage fraud operation that arranged 500 dubious loans involving 180 houses.

Seven people were charged Wednesday, including the alleged ringleader, Ronnie Duke, 43, The Detroit News reported. The operation allegedly ran for four years and brought in $100 million.

"This is the largest mortgage fraud we have seen in terms of the number of properties that were involved and the money that was stolen," U.S. Attorney Barbara McQuade said.

The FBI charges the group used straw buyers for some transactions and in other cases obtained mortgages for property that did not actually change hands. Many of the homes involved in the scheme ended up in foreclosure, making neighborhoods less stable.

"Everyone pays the price," Curtis Novy, a California expert on real estate fraud, told the News.