Manhattan District Attorney Robert M. Morgenthau said Wednesday that 13 people, including three principals of AFG Financial Group Inc. of Garden City, N.Y., have been indicted in an alleged mortgage fraud believed to have exceeded $100 million.

Aaron Hand, AFG Financial's president, and AFG principals Eugene Culbreath and Eric Shields and 10 others have been charged with enterprise corruption, grand larceny, scheme to defraud and conspiracy.

The mortgage brokerage itself also has been indicted.

The individuals face up to 25 years in prison on the larceny charges.

Twelve other people, including two lawyers, have pleaded guilty in the matter.

Five lawyers in all have been charged in the case, Morgenthau said.

"These defendants were all crooks," Morgenthau said. "Their crooked dealings were facilitated by the secondary market for mortgages."

Morgenthau said his office has brought charges related to 19 mortgage transactions between 2004 and 2007 that totaled more than $12 million.

His office said it believes the fraudulent transactions will exceed $100 million.

The investigation is ongoing.

The mortgage fraud case is one of several such cases that Morgenthau's office is pursuing.

He said hundreds of similar complaints have surfaced in the New York area.

One lawyer who pleaded guilty in the case was involved in transactions with AFG Financial that exceeded $102 million, Morgenthau said.

AFG Financial was run as fraudulent enterprise, Morgenthau said.

"If there was any legitimate side of the company, it was by accident," he said.

Morgenthau said the defendants located distressed residential real estate properties in the New York City area and engaged in a scheme to defraud banks by creating sham sales of the properties, often by recruiting straw buyers to take out mortgages on the properties.

In one case a vacant lot in the Bronx was represented as a two-family home worth more than $500,000, Morgenthau said.

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