A man and woman were indicted in Portland, Ore., for allegedly defrauding mortgage lenders out of millions of dollars, according to an indictment that was unsealed in federal court Thursday.

Clifford J. Brigham and Melodie MacDuffee were charged with mail fraud, wire fraud, money laundering and Social Security fraud in connection with a scheme that defrauded lenders out of about $5 million dollars from October 2004 to August 2005, officials said.

MacDuffee, an Oregon resident, was arrested without incident Thursday in southeast Portland by IRS special agents and U.S. postal inspectors, according to a statement from the Oregon U.S. Attorney’s office. MacDuffee was remanded to the custody of the U.S. Marshal’s Service pending a detention hearing scheduled for tomorrow.

Brigham, who was recently a Washington resident and an Oregon resident prior to that, is in the custody of the U.S. Bureau of Prisons on prior charges, officials said.

According to the indictment, Brigham and MacDuffee allegedly used false pretenses to obtain millions of dollars worth of home loans — and then diverted loan proceeds to themselves. The defendants used “straw purchasers” to obtain nearly all of the loans. Specifically, the indictment alleges the two paid people who had good credit ratings to apply for home loans, telling these people that they did not have to repay the loans. Brigham and MacDuffee allegedly paid these straw purchasers thousands of dollars for each loan application submitted, in effect purchasing credit histories from people with good credit ratings.

Brigham and MacDuffee also allegedly falsified loan applications submitted in the names of the straw purchases in various ways, including inflating both the reported income earned and assets owned by the loan applicants; falsely declaring the loan applicants’ intent to occupy the property; and falsely declaring that the loan applicants would contribute to the down payment for the loan.

The alleged scheme included purchases of property in Washougal, Wash., and three Oregon cities, including Beaverton, Redmond and Portland. The property in Washougal was featured in a “Parade of Homes” and included a view of the Columbia River Gorge.

The accused obtained more than 25 home loans, totaling more than $5 million, according to the indictment. Between January and August of 2005, they allegedly diverted hundreds of thousands of dollars of the loaned money to themselves. Brigham also took up residence in a million-dollar home purchased with fraudulently obtained loans.

The indictment alleges that Brigham committed these crimes while on release from custody pending appeal of a 2003 conviction in federal court on six counts of loan-related fraud. If proven, this allegation will mandate an increased sentence for any crime for which Brigham is convicted.

Each of the 20 fraud charges alleged in the indictment carries a maximum sentence of 20 years in prison and a maximum fine of $250,000, officials said.

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