Unsealed court documents obtained by ABC7 News describe just how deeply investigators suspect this scheme goes.
Authorities served a search warrant at a home in Brentwood which they believe also doubles as the offices of KATN Trust. The company is owned and operated by Alan David Tikal, the same man who pleaded no contest to two counts of mortgage fraud in Alameda County.
7 On Your Side first reported in May that KATN recruited distressed homeowners from throughout California, as well as Nevada, Oregon, Arizona, Georgia, Florida and Illinois.
Those homeowners tell us KATN charged them an upfront fee of $1,500, all for what they now say was a false promise of saving their homes and reducing their mortgage by 75 percent. One of them, who asked not to be identified, says he recruited family and friends before realizing he was being duped.
He said, "It ruined my reputation with all the people I brought in. Now they're angry. They don't believe in me. They ruined my business, everything."
Public documents independently obtained by ABC7 News show KATN continued to operate even after Tikal was jailed in February. In addition to Tikal, among the suspects named in the federal investigation are Tikal's fiance, Tamara Silva, as well as Brandon D. Le -- he's the man who hosted the webinars used to recruit new clients.
Le in the webinar said, "Like we saw earlier in the past, 95 percent success ratio. The ones we have right now are even higher than that, which is quite exciting."
Bruce Blankenhorn and Luis DeLeon who still await trial in Alameda County have also been named as suspects. Court records show Tikal and Silva deposited $1.4 million into their bank account in 2010 alone, primarily from KATN funds.
It's important to note, that no formal charges have been filed in the federal case. Tikal's attorney tells us her client will fully cooperate with the investigation.