ROSEDALE, Md. (WJZ)—An elaborate extortion scheme generated thousands of dollars. Investigators say it was Baltimore City police officers and the owners of a local business who were behind it all.

Kelly McPherson explains how investigators say the operation worked.

In a two-year investigation, federal authorities claim 17 officers took kickbacks for illegally steering car accident victims to a Rosedale auto body shop.

Majestic Auto Repair Shop in Rosedale is at the center of the massive kickback scheme, involving 17 city police officers.

A 41-page federal criminal complaint outlines the allegations, claiming the officers would respond to car accidents and convince car owners to have their cars towed and repaired by Majestic rather than a city authorized towing company.

In exchange, Majestic paid the officers kickbacks of $300 per vehicle with one officer allegedly making more than $14,000 over two years.

According to that complaint, one officer said to the shop owner: “My pay made me cry with that two percent cut, which is less $100 from my check.” The shop owner responds, “Keep an eye out for cars. That’s where you’ll make it.”

The following defendants, all from Maryland, are charged in the conspiracy:

Hernan Alexis Moreno Mejia (Moreno), age 30, of Rosedale; Moreno’s brother, Edwin Javier Mejia, age 27, of Middle River; Eddy Arias, age 39, of Catonsville; Eric Ivan Ayala Olivera, age 35, of Edgewood; Rodney Cintron, age 31, of Middle River; Jhonn S. Corona, age 32, of Rosedale; Michael Lee Cross, age 28, of Reisterstown; Jerry Edward Diggs, Jr., age 24, of Baltimore; Rafael Concepcion Feliciano Jr., age 30, of Baltimore; Jaime Luis Lugo Rivera, age 35, of Aberdeen; Kelvin Quade Manrich, age 41, of Gwynn Oak; Luis Nunez, age 33, of Baltimore; Samuel Ocasio, age 35, of Edgewood; David Reeping, age 41, of Baltimore; Jermaine Rice, age 28, of Owings Mills; Leonel Rodriguez Torres, age 31, of Edgewood; Marcos Fernando Urena, age 33, of Baltimore; Osvaldo Valentine, age 38, of Edgewood; and Henry Yambo, age 28, of Reisterstown.

The Baltimore Police Department requires that when police request vehicle towing services, they only use towing companies that are under contract with the city of Baltimore to provide towing services for the Baltimore Police Department.

Defendants Moreno and Mejia are brothers who own Majestic Auto Repair Shop LLC (Majestic), located in Rosedale. Majestic provides towing and automobile repair services. Majestic is not an authorized tow company with the city of Baltimore. The remaining defendants are Baltimore police officers.

The commissioner set up the sting arrest by bringing the accused officers to the police academy Wednesday.

Police commissioner Fred Bealefeld says he purposefully chose to have the officers arrested at the police academy to serve as a reminder to the city and his officers of their commitment to fight corruption. He says the officers were told to report there Wednesday morning for an equipment inspection.

“I personally took the badges from every one of those men who were arrested today,” said Commissioner Fred Bealefeld. “There will be important lessons for us to learn from start to finish in this whole thing and I didn’t and don’t want to miss a single opportunity to capitalize on that and that’s why I chose that location. We just can’t give order to corruption. We can’t and won’t and will exhaust every means to eliminating it from our ranks.”

The FBI says the investigation began with the city police department and involved wiretaps and electronic surveillance all started by the city police department.

“There is absolutely nobody in this police department that should be hanging their heads right now. The police department did a very good job rooting out alleged corruption within their own ranks and they should be very proud of that effort,” said Richard McFeely, FBI.

Fifteen of the officers had their first court appearance Wednesday. Police are trying to track down two of the officers who have not yet been arrested because they were on previously scheduled vacation.

All of them have been stripped of their police powers and are suspended without pay pending the outcome of the criminal investigation.

“When we have a few bad apples, they make it bad for all of them. And the officers that we have in our city make too many sacrifices for that to be the case,” said Mayor Stephanie Rawlings-Blake.

She also released a statement.

“I expect all City employees to serve the public with the highest level of integrity, and I will not tolerate criminal or unethical activity by any city employee. I appreciate the efforts of Commissioner Bealefeld and our federal partners for working closely together to investigate, arrest, and prosecute these individuals. Any criminal activity by a Baltimore police officer dishonors our city and the 3,000 men and women of the Baltimore Police Department who serve with great professionalism and integrity.”

Police say the owners of the Majestic Body Shop spent thousands of dollars in exchange for bringing cars to their shop for repair work.

Federal agents and officers were at the shop Wednesday for several hours, according to witnesses. They were pulling out boxes, presumably full of evidence from inside the shop.

The shop is currently closed.

WJZ spoke to a nearby business owner who said sometimes the business at Majestic would get so busy that cars would have to park in the lot across the street.

That business owner says he did not suspect anything.

“I know them because they are my neighbors,” said Hanrek Singh, Club 7400 owner. “But I don’t know what they’re doing in there.”

While Singh says Majestic owners were “good guys,” another neighbor did say that he was not surprised to see police activity, but he was not aware of what was going on.

Click here to read the full affidavit.

Stay with WJZ.COM for the latest on this developing story.