Five people in an alleged mortgage fraud ring have pleaded not guilty to conspiring to steal $1.9 million in real estate loans.

On Wednesday, a federal grand jury in Honolulu indicted Welton Kalani, Bobby Wood, Stephen Balino, Audra Palomares and Carlton Yim.

The five were arrested Wednesday morning and later released each on a $50,000 unsecured bond.

According to the grand jury indictment, the defendants processed loans in 2006 for an Aiea home and one in Mililani as employees or owners of Accel Mortgage LLC, New Horizons Financial, Inc., and Walter P. Yim & Associates.

As part of the scheme, people found homeowners struggling to make mortgage payments and promised to help them keep their homes if they agree to a “;sham”; sale of their home to a third party or a “;straw purchaser,”; according to the indictment.

The straw buyers received $12,000 to $15,000 to sign false documents that stated they intended to live in the properties and inflated their incomes, the indictment said.

The original homeowners could not make the higher payments and the homes moved into foreclosure.

The indictment comes after an 18-month investigation, said FBI Special Agent Tom Simon.