According to prosecutors, she convinced her stepmother to provide information on the loan application stating that Herrera worked at a liquor store owned by the stepmother's husband, thereby falsely increasing the couple's income and qualifying them for the loan.
The loan was granted in 2006, and defaulted on in 2008. But it wasn't until 2010 the alleged crime was discovered during an investigation into mortgage fraud by the
The total loss from the fraud was
Both O'Malley and her stepmother,
O'Malley and Flores are free on bond.
The timing of the alleged crimes and the filing of charges is of particular importance in this case because defense attorneys are arguing the statute of limitations has expired. The alleged crimes are eight years old, and there is a three-year statute of limitations on the conspiracy charges, four years for the fraud charges.
Isen contends the government didn't became aware of the alleged fraud until
"Our position is that, aside from the statute of limitations,
The hearing began Tuesday and continued through Friday and, because of the added charges, Judge
The Herreras are not charged in the case. It was during an interview with a HUD special agent that
In fact, she was unemployed at the time they applied for the home loan.
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