LAS VEGAS (CN) - A Texas man and his wife were sentenced this week to years in federal prison for a mortgage fraud scheme they ran in Nevada.
Derrick Phelps, 46, was sentenced to 70 months, and Cynthia Phelps, 44, to 4 years. U.S. District Judge James Mahan sentenced them on Tuesday.
The Phelps, of Katy, Texas pleaded guilty in April to seven counts of bank fraud and one count of conspiracy to commit bank fraud, mail fraud and wire fraud.
Their scheme from 2003 to 2006 involved finding buyers with good credit ratings and using false information on mortgage applications to buy 233 homes in the Las Vegas area for more than sellers were asking and then default on the loans after pocketing the difference.
Federal investigators say the scheme cost federally insured lenders more than $30 million.
The Phelpses, who operated out of fast-growing Henderson, a Vegas suburb, also were ordered to pay $31 million in restitution and five years of supervised release.
Three co-defendants - Linda Mack, Tai Keyster and Darryl Reese - are set for trial March 2015, the U.S. Attorney's Office said.
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