RIVERSIDE -- A federal judge ruled that two Murrieta-area men defrauded dozens of investors and ordered them on Monday to repay a total of $58.6 million.

The order followed a civil lawsuit in which the U.S. Securities and Exchange Commission accused James Duncan and Hendrix Montecastro of selling unregistered securities and defrauding investors through fabricated investments. Judge Virginia Phillips agreed with the bulk of the agency's claims and noted that Duncan and Montecastro had invoked their Fifth Amendment rights not to offer testimony that could be used in a subsequent criminal prosecution. An attorney for one of the men cited an FBI raid of their homes in February 2008 for the refusal to testify.

In a separate lawsuit, former clients allege that Duncan and Montecastro roped them into a real estate investment arrangement that pushed about 100 homes, most of them in Murrieta, into foreclosure in 2006 and 2007.

Phillips ordered Duncan to repay $30.3 million and Montecastro to repay $28.3 million, amounts that include interest. Maurice McLeod, a co-defendant who settled some claims with the SEC last year, was ordered to repay $483,000. Phillips ordered fines of $130,000 for each of the men and ordered them barred from offering investments in the future.

"The wrongful conduct continued over the course of at least three years and defendants evolved their conduct to evade detection as well as to continue to separate investors from their money," Phillips wrote. "Defendants have not recognized the wrongful nature of their conduct and have not given any indication that they will not engage in such conduct in the future."

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