A GoFundMe that was set up by McClure and her boyfriend D'Amico raised more than $400,000 to help Bobbitt. The news outlet said D'Amico and McClure turned themselves in on Wednesday.
Prosecutors have been focusing on D'Amico and McClure and their home in Florence, N.J., was raided in September, nj.com reports.
She said Bobbitt used his panhandling money to get her out of the jam.
"The entire campaign was predicated on a lie", said prosecutor Scott Coffina. Bobbitt hired a pro-bono attorney, who announced that instead of the full $402,000, Bobbitt only received $75,000, which he used for a camper and an SUV, instead of actual housing.
Ms McClure and Mr D'Amico told their online supporters the money would go to two financial trusts for Mr Bobbitt, as well as a lawyer and a financial adviser to help him manage all the money.
A New Jersey couple who made national headlines after raising almost half a million dollars for a homeless man through a GoFundMe page is facing criminal charges. "I wasn't expecting anything in return", Bobbitt, 34, told "Good Morning America". The money, Bobbitt said, would change his life.
"Rather, D'Aminco, McClure and Bobbitt conspired to fabricate and promoted a feel-good story that would compel donors to contribute to their cause", he said.
The Burlington County Prosecutor's office is expected to make an announcement in the case later today, according to multiple reports.
"During one text exchange in March 2018, McClure lamented that the pair had less than $10,000 remaining", said Coffina.
A source familiar with the case told NBC10 that officials now believe the couple, Mark D'Amico, 39, and Kate McClure, 28, worked with the man, Johnny Bobbitt, to scam people out of money with their sob story.
Prosecutors began investigating after Bobbitt claimed he wasn't getting the money that had been raised on his behalf.
D'Amico and McClure were processed and released late Wednesday, while Bobbitt is awaiting extradition to New Jersey.
The feel good story fell apart in August when Bobbitt claimed in a lawsuit he was never given any money and the couple spent it on a vacation and a vehicle.
What was once a feel-good story may lead to conspiracy charges for a New Jersey couple and a homeless man they raised money for following a good deed.
"While this type of behavior by an individual is extremely rare, it's unacceptable and clearly it has consequences", he adds "Committing fraud, whether it takes place on or offline is against the law".
D'Amico and McClure denied the allegations. He later filed a lawsuit against McClure and D'Amico.