$12M identity fraud exposed - Law enforcement officials have exposed an alleged mortgage fraud and identity theft ring in Broward County responsible for taking out some $12 million in

Using stolen identities and straw buyers to apply for bogus home loans, 11 people from South Florida ran a multimillion-dollar mortgage fraud and property flipping scheme in Broward County, authorities said Tuesday.

An investigation by local, state and federal law enforcement agencies uncovered the criminal ring, which allegedly conned banks into lending roughly $12 million to fund the purchase of 30 homes starting in 2002.

Yvette Scott Patterson, 40, formerly of Lauderhill, is accused of masterminding a scheme to submit fraudulent loan applications using the false information through her mortgage company, Khadmilroy Inc., according to the indictment unsealed Tuesday.

Patterson, husband Delroy Patterson, 45, and nine others were charged with multiple counts of conspiracy to commit mail, wire and identity fraud.

The Pattersons are currently in Jamaica, where the U.S. government is seeking their extradition.

The group is believed to have profited from the sales of the fraudulently purchased property as well as more than $300,000 earned in broker's fees through Patterson's mortgage company.

"These defendants were well organized and dedicated to getting rich at the expense of others," U.S. Attorney R. Alexander Acosta said at a news conference Tuesday to announce the investigation dubbed "Operation Whose House."

Also named in the 47-count indictment: Christine Brown, 30, of Fort Lauderdale; Megan McGuire, 40, of Miramar; Roosevelt Dozier, 39, of Hollywood; Ishmael Grant, 59, of Lauderhill; Mavis Grant, 62, of Lauderhill; Adewui Majaro, 42, of North Miami; Mark Reid, 36, of Miramar; Audrey Lynch,36 of Fort Lauderdale; and Fitzgerald Puddie, 32, of Hollywood and Toronto.

Some of the accused were in jail on other charges, two were arrested Tuesday morning and bailed out, and others were still at large.

The case underscores the growing problem of real estate related crime in Florida. The state ranked first in mortgage fraud in 2006 in a national index released earlier this year by the Mortgage Asset Research Institute, an industry data clearinghouse.

Mortgage fraud is among the fastest-growing white-collar crimes in the country and has become problematic in especially heated markets.

Acosta said mortgage fraud was a "substantial issue" in South Florida and urged lenders to closely scrutinize all loan applications to protect themselves and consumers from criminals.

Mortgage fraud typically involves more than one professional insider colluding with others to pull off the heist. The schemes can be complex.

Here's how the Patterson ring allegedly operated to finance the purchase a home in Sunrise:

According to the indictment, in November 2002, the defendants allegedly filled out a loan application, with phony wage stubs, W-2 forms and other documents, using a stolen identity to buy the property at 9731 NW 25th Ct. in Sunrise for $170,000.

They used a fake Florida's driver's license as proof of identity to close on the property.

Using the same method, the gang resold the property a year later to a second victim, whose identity was stolen to get a $190,000 mortgage.

Finally, in November of 2004, the defendants sold the property a third time to another victim by taking out a loan in the victim's name for roughly $239,000.

In Broward County's surging real estate market, Patterson and her crew were able increase the value of the property by 40 percent in a little over two years. At the same time, they profited from high broker's fees, which in some transactions reached $20,000, according to the indictment.

For other loans, Patterson allegedly paid people to use their financial information to qualify for loans. These willing participants in the fraud are called straw buyers. Acosta said law enforcement was alerted to the possible scheme when an out-of-state victim's personal information had been used to buy four different properties.

While the ring was planning its next fraudulent purchase, members rented out the homes to additional victims in bogus rent-to-own schemes. Acosta pointed out there are often numerous victims in a mortgage fraud scheme.

"Actual individuals whose identities were stolen have been left with ruined credit. Tenants, who -- in the hopes of owning a home -- paid high rents with the understanding that the rent money would go toward an option to buy, have seen their hopes and their money vanish. Persons living in these homes face eviction," as banks foreclose, Acosta said. "And, of course, banks have been left with unpaid loans."