A newly unsealed 56-count indictment charges 10 people in California in a $20 million mortgage fraud scheme in Bakersfield, Calif., said U.S. Attorney Benjamin Wagner. Defendants surrendered or were arrested in recent days in San Diego, Ventura County, Bakersfield and Monterey, Calif., after being indicted two weeks ago. Defendants David Crisp and Carlyle Cole were the owners of Crisp, Cole & Associates, also known as Crisp & Cole Real Estate. They also controlled Tower Lending, CCA’s in-house mortgage broker business. Other defendants were employed at CCA or at Tower Lending, or both. Five others, including a CPA and two former loan officers for Tower Lending, have previously pleaded guilty in related cases. The indictment alleges that from approximately January 2004 to September 2007, the defendants schemed to defraud mortgage lenders by submitting fraudulent loan applications with material misrepresentations, including the borrower’s income, assets, employment status and intent to use the home as the borrower’s primary residence. The indictment alleges that the defendants flipped homes, which is the selling of a single home on multiple occasions, through a series of fraudulent transactions to co-defendants, straw buyers and others in order to artificially inflate the prices of the residences. The defendants typically increased the loan amounts and used close to 100% financing in order to extract the inflated equity amounts from the properties on each financing transaction. CCA generally acted as the real estate brokerage on the sales, and Tower Lending acted as the mortgage brokerage, generating substantial commissions and fees for the defendants on each transaction. “In the mid-2000s, Crisp, Cole, and Associates was a high-flying real estate firm,” Wagner said. “When mortgage fraud is committed on a broad scale, as alleged in this indictment, the mortgage lenders are not the only victims. Fraud schemes that involve rapid inflation of real estate prices followed by sudden foreclosures create a market rollercoaster that takes many innocent homeowners along for the ride.” The investigation included the FBI, the Department of Housing and Urban Development and the Bakersfield Police Department. The enforcement action is also part of President Obama’s Financial Fraud Enforcement Task Force. Charges varied per individual but included conspiracy to commit bank, mail and wire fraud, and individual counts of mail fraud. Certain defendants were also charged with wire fraud, bank fraud, and conspiracy to launder money. The defendants face a maximum prison sentence of 10 to 30 years and a maximum $1 million fine, depending on the charge. The case involved the following defendants: David Marshall Crisp, 31; Carlyle Lee Cole, 63; Julie Dianne Farmer, 42; Sneha Ramesh Mohammadi, 49; Jayson Peter Costa, 38; Jeriel Salinas, 29; Robinson Dinh Nguyen 30; Michael Angelo Munoz, 31; Jennifer Anne Crisp, 29; and Caleb Lee Cole, 35. Defendant Jennifer Crisp is the wife of David Crisp, and defendant Caleb Cole is the son of Carlyle Cole. Write to Kerry Curry. Follow her on Twitter @communicatorKLC.