I am not publishing this answer because I possess fantastic legal insights into your predicament -- I do not -- but so that other readers will learn from your misfortune as the spouse of a straw buyer.
If the facts in your message are accurate, your spouse was a victim of fraud, her own ignorance of the law, and a profound lack of common sense. The fact that your spouse proceeded in an ill-advised scheme with no possible chance of profit even with honest partners that endangered her spouse's financial well-being is evidence not just of naivete, but destructive behavior.
I am curious why the LAPD would not accept a fraud report from your spouse. If she states that she signed the documents for a loan, and then never received the cash and is left with a house she never bought, that sounds like a simple confidence case.
You mentioned the LAPD, so I will assume you are a California resident and the events transpired in California. As a California resident, you are governed by California's family laws. California is a community property state. This means that property (real or personal) acquired during marriage is owned by the community (with the exception of gifts). Debt (aside from student debt) acquired during marriage is community property, too. Which means that both spouses have liability for debt incurred by one spouse during the marriage, including stupid debt. However, in practice, it is rare for creditors to pursue both spouses in community property states. That is not to say creditors never pursue both spouses because creditors have the right to do so under California law. Because you were married to the straw buyer during the transaction, you have liability for the debt regardless of your marriage or divorce now.
One course of action for you to consider is to proceed with the divorce (or not) and wait to see if both your (ex)spouse and you receive summons to appear for the breach of contract lawsuit filed by the creditor. If you do receive such a document, you may wish to consider bankruptcy.
Best of luck on your predicament. Please return here and update us on what transpires with the straw buyer.
I hope this information helps you Find. Learn & Save.