Four people, including a local pastor, have been indicted on charges of mortgage fraud.
The U.S. Attorney's office announced the charges Friday.
They said Michael Wilkerson, Joyce Wilkerson, Lee Garell and Denise Haines were charged with fraudulently getting home loans, valued at more than $6 million, from Chase Manhattan Bank.
The mortgages were for properties in Schwenksville and Glenmoore, Montgomery County.
According to the indictment, Michael Wilkerson, who is the pastor of New Millennium Life Restoration Fellowship, which has churches in Phoenixville and Spring City, recruited several members of the church to take part in the real estate transactions.
Wilkerson recruited at least five members of his congregation to act as "straw purchases" for the properties. This means they would sign the loan documents as the purchaser of a house and attend the property settlement, according to the indictment.
The indictment went on to state that Joyce Wilkerson would be listed as a co-owner of the property and Michael Wilkerson promised the straw purchasers that all they would have to do is show up for settlement and sign the documents. He told them his plan was to rent out the property until the home rose in worth, then re-sell it. He told them to use the rent money to pay for the mortgage.
For their troubles, Wilkerson would pay them $15,000.
According to the indictment, Lee Garell prepared the sales paperwork for each home and dictated the terms set out in the settlement sheets.
It also said Denise Haines would prepare the mortgages, and use false information about the straw purchasers to make it look like they had more assets and made more money than they actually did, so they could get a loan for more money.
The indictment also stated Wilkerson had the homes appraised. The appraisals significantly over-valued the properties, and they were able to get loans for more than $1 million on each home.
Wilkerson lived in one of the homes, and rented out the other four, according to the indictment.
The indictment stated that after six months, he told the straw purchasers they had to take over the mortgage payments, which led many of them to fall into default and then foreclosure for a loss of around $3 million.
Each defendant faces a maximum sentence of 180 years in prison, five years supervised release, a fine of up to $6 million, and a $600 special assessment.
To see the full indictment, click here.