ORANGE COUNTY: Last month, District Attorney investigators raided the homes and business offices of Vijay and Supriti Soni of Corona del Mar. Now, prosecutors are investigating the Sonis and other members of their family for criminal behavior.

Doug Brannan, the deputy Orange County District attorney who prosecuted the Sonis in 2003, said, "Unfortunately, we are back looking at these characters again," according to a report in the Orange County Register.In August 2003, an Orange County Superior Court jury found Vijay and Supriti Soni guilty of forgery, falsifying real estate documents, identity theft and grand theft. Vijay Soni was sentenced to a year in jail. He also surrendered his real estate license. Supriti Soni was convicted on 19 counts in the case and sentenced to three years in prison.

Brannan, who prosecuted the case, said their scheme "took advantage of their clients' trust when they exploited the unsuspecting customers' information for their own financial gain. They left these families with large financial liabilities, goods and property purchased in their name without their knowledge, many hidden costs, and a huge amount of grief to clean up their credit."Now in July 2007, Vijay and Supriti Soni of Corona del Mar paid $440,000 for a home at 2129 W. Civic Center Drive in Santa Ana.

Five weeks later, they resold the house to Javier Hernandez - the family gardener and handyman - for $660,000. That's a 50 percent gain in 38 days - at a time when real estate prices in Santa Ana were plunging.But the lender that financed both mortgages - Washington Mutual Bank - took a bath. In March of this year Hernandez's loan went into default and in July the bank foreclosed.

On the trustee's deed, the bank listed the home's value at $377,137 - $220,000 less than the outstanding loan.Records show that Washington Mutual, America's largest savings and loan and one of its most precariously perched lending institutions, financed at least 43 mortgages worth $24.5 million on properties bought and sold by members of the Soni family since early 2007.Of the 22 homes sold in that period, at least six have become problems for Washington Mutual: Four were foreclosed, one received a notice of default and another was listed for sale at a $260,000 loss.

Total value of WaMu's mortgages on the troubled properties: $2.7 million.The Soni family's transactions with WaMu, which took place from early 2007 through March of this year, indicate that Washington Mutual continued making risky loans long after its underwriting standards were supposedly tightened, said James Barth, a senior finance fellow at the Milken Institute in Santa Monica."Lending institutions had an obligation to do due diligence to make sure the borrower can repay the loan, especially in 2007 and 2008 when they knew there was a mortgage meltdown taking place," Barth said.

Home prices in Santa Ana peaked in 2006 and have fallen more than 40 percent since.While those prices were plummeting, members of the Sonis' family never sold for a loss. A Register analysis of 22 Santa Ana properties flipped by the family in the past two years shows a total gain on sale of $3.7 million.Average gain: 48 percent.Average time between purchase and sale: 92 days.

On Aug. 7, 2008, investigators from the Orange County District Attorney's office and state Franchise Tax Board served search warrants on nine locations, including the homes of the Sonis, her mother Sushama Lohia and the family of her sister Suniti Shah plus four family companies - SL Realty, California Escrow, New Age Realty and First Priority Escrow. They carted out 154 cardboard boxes and 40 computers filled with evidence.In the past two years, the Soni family essentially created their own market in Santa Ana by flipping enough homes in a small area, said Lackner, the appraisal fraud specialist.

In at least three cases, homes flipped from one family member to another - sales later used by appraisers to give credibility to high asking prices for other properties in the area.One example: Lohia bought the bank-owned house at 827 S. Flower for $249,500 on Jan 4. She sold it 20 days later for $575,000 to her daughter, Suniti Shah, who financed the purchase with a $488,750 Washington Mutual mortgage.That was a 121 percent increase in less than three weeks.