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Mortgage Fraud Archives

Mortgage Fraud Investigation Leads to Nine Indictments

Several properties northwest Florida were supposed to be part of a real estate development project known as Riverwalk. The subdivision never happened and nine people involved in the project have now been indicted for mortgage fraud schemes involving the land. The group faces lengthy sentences in federal prison and massive fines if convicted of the charges. Among the crimes alleged to have occurred are conspiracy to commit bank fraud, bank fraud, conspiracy to commit mail fraud, mail fraud and conspiracy to commit money laundering.

Massive Mortgage Fraud Task Force Launched

Even as several state attorneys general seek to settle with five major banks over the robo-signing of mortgage documents, a group of 55 Justice Department attorneys and other government officials from all over the country have joined up to investigate the formation and selling of mortgage-backed securities. The mortgage fraud task force will investigate how mortgages were securitized and sold, a practice that contributed to the downturn in the U.S. economy. While there is significant overlap in the conduct being discussed in the settlement and the actions being investigated by this task force, part of the difference will be a new focus on filing criminal charges against individuals who participated in the mortgage-backed securities market.

Mortgage Fraud a Common Practice

As the former executive vice president in charge of fraud investigations at Countrywide Financial, Eileen Foster has a keen understanding of how the mortgage industry works. She has now acknowledged that mortgage fraud not only occurred at Countrywide, but was in fact a common practice. The concerns over mortgage fraud at Countrywide have followed it to their new owner, Bank of America. Public pressure to hold home lenders accountable for misrepresentations is at an all time high.

Mortgage fraud and organized crime

After conducting raids in Florida, Texas and New Jersey, federal prosecutors charged thirteen people with wire fraud, money laundering, racketeering, securities fraud and making false statements on loan applications. The mortgage fraud case is noteworthy because FBI investigators claim the people charged are members of the mob in Philadelphia. They claim that white collar crimes such as mortgage fraud are replacing the traditional sources of income in organized crime groups.

Palm Beach County, Florida, rank high in mortgage fraud

The second quarter numbers are in and Palm Beach County passed Broward and Miami-Dade counties to move into sixth place nationally in reported mortgage fraud. Florida as a whole moved into second position, behind only California in mortgage fraud reports per capita. The report reflects the increased efforts by financial institutions and federal law enforcement officials to catch and prosecute people suspected of real estate fraud.

Charges filed in $40 million mortgage fraud case

Federal prosecutors have charged 20 South Florida residents in one of the largest indictments in recent memory. The group, made up of mostly professionals in the real estate and banking industries, faces charges for their alleged participation in a massive mortgage fraud scheme. Each member of the group faces multiple charges. Each charge carries a potential penalty of 30 years in federal prison.

Mortgage fraud arrests still rising

The Federal Bureau of Investigation recently acknowledged that one of its most targeted activities is still on the rise. According to the FBI's year-in-review report on mortgage fraud, the instances of fraudulent behavior have increased despite fewer home sales. The depressed housing market and continued failings in bank underwriting policies have contributed to this increase. Last year, there were 23% more foreclosures than in 2008. It is unclear what percentage of this increase can be attributed to mortgage fraud.

Mortgage industry continues robo-signing documents

Over eight months ago mortgage companies and giant banks across the nation promised to clean up their acts when it came to mortgage documents. As the housing bubble burst, and the mortgage industry collapsed, many large lenders and banks came under scrutiny for their foreclosure practices.

Fannie Mae and the Taylor Bean mortgage fraud case

The legal actions surrounding Taylor, Bean & Whitaker Mortgage Corp. may be over as a judge sentenced former chairman and principal owner to 30 years in prison. While the criminal prosecution may be over for Taylor Bean officials, the fallout continues surrounding the $3 billion dollar mortgage fraud scheme. It appears that executives at the government-sponsored entity Fannie Mae were aware of fraudulent activity as early as 2000. The officials at that company made no report of the criminal activity simply withdrew from doing further business with Taylor Bean. Much of that business was then transitioned to fellow government-sponsored entity Freddie Mac. Freddie Mac has filed a claim as a creditor in Taylor Bean's bankruptcy case for $1.8 billion dollars.

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