There is no way to rank the frequency with which fraudulent real estate transactions occur. The Mortgage Fraud Index tries to get a sense of how often this is occurring by tracking the volume of criminal cases in a given jurisdiction. A poor placement on the ranking could be a sign of zealous law enforcement and heavy prosecution as much as a sign that the practice is common. Florida again ranks as the worst state in the Mortgage Fraud Index, indicating that there are more criminal cases against people charged with mortgage fraud than in other states.
A Miami loan officer for Great Country Mortgage Bankers pleaded guilty in April to a single count of conspiracy to commit wire fraud. For his role in a larger plan to commit mortgage fraud, he was sentenced to 4 years and 6 months in prison and ordered to pay $9.2 million in restitution. The federal court levied the sentence this week.
A former loan officer for Washington Mutual was sentenced to 15 months in prison by a federal judge last week. The sentence was for his role in a mortgage fraud scheme based in Southwest Florida. The 66-year-old banker is the fourth person involved in the house-flipping scheme to be sentenced and is one of 19 who have been convicted or pleaded guilty for their roles in the real estate fraud.
A $1.4 million insurance scam led to 20 arrests by the Miami-Dade Police Department's Economic Crimes and Arson Division. A group used false renters, known as straw renters, and arson to file fraudulent insurance claims. The investigation, referred to as Operation Candlelight, focused on a series of fires, 12 in total, which occurred over a five year period. In each fire, the straw renter claimed to have accidentally left a candle burning next to an object that caught fire and spread to the rest of the property.
The Federal Trade Commission has reported a significant increase in the number of complaints involving time share owners being approached by people claiming to have a buyer lined up. Often there is no buyer and the person claiming to be a representative is using the fake transaction to gather cash, bank information and personal identification information, such as Social Security numbers. Time share resale fraud now ranks number one in complaints received at the Florida Attorney General's Offices.