Mortgage Fraud Update

FBI Vows to Crack Down on Mortgage Fraud(December 15, 2005)

-- Savvy criminals targeting home buyers and real estate investors have transformed mortgage fraud into a "growing epidemic," the FBI says.

Law enforcement officials with the federal government have announced that the number of reports of suspicious activity involving real estate transactions has risen to 21,994 in fiscal 2005 from 17,127 a year ago.

Additionally, the FBI is investigating 721 pending mortgage fraud cases, up from 534 last year.

"Lenders have come to the conclusion that mortgage fraud is a threat to their business," says Mortgage Bankers Association official Tim Doyle, who notes that the group has worked closely with the FBI in recent years on the issue of mortgage fraud.

Still, FBI officials say the real estate and banking industries are not doing enough, such as checking for legitimate Social Security numbers and forged signatures, verifying the value of property in appraisals, and regulating mortgage brokers.

Source: Washington Post (12/15/05); Downey, Kirstin