Law enforcement officials say fraudsters and con artists see opportunity in turmoil, and right now, arguably the most tumultuous economic sector is housing.

In its first year, the Financial Fraud Enforcement Task Force (FFETF) more than doubled the number of defendants charged with mortgage fraud by U.S. Attorneys’ Offices. Charges rose from 526 in 2009, before the task force was formed, to 1,235 in 2010, post-FFETF.

Mortgage fraud punishments followed the same trend, with a near doubling of the number of defendants sentenced to more than two years in prison.

“Mortgage fraud became an epidemic a few years ago during the housing bubble and remains a serious challenge for law enforcement today,” said U.S. Attorney Ronald Machen.

“Our success in criminally prosecuting mortgage fraud during the last year is a byproduct of our steadfast commitment to rooting out the fraudulent conduct that continues to undermine our nation’s economic recovery,” Machen added.

FFETF is acclaimed as the largest coalition ever convened to confront fraud in the financial sector. It’s comprised of more than 25 federal agencies, regulators, and inspectors general, as well as state and local law enforcement partners.

The task force orchestrated the largest mortgage fraud sweep in the nation’s history over a three-and-a-half month span last year – Operation Stolen Dreams.

Between March 1, 2010 and June 17, 2010, Operation Stolen Dreams caught up with 1,517 criminal defendants who have since been charged, convicted, or sentenced. Perpetrators rounded up in the spring sting cost their victims more than $3 billion.

The operation also resulted in 191 civil enforcement actions and the recovery of more than $196 million.

Task force members themselves describe the results as “impressive,” but as far as they’re concerned, it’s not enough.

“While we have accomplished much in the first year of the Task Force, our work is far from complete,” said Eric Holder, U.S. attorney general and chairman of FFETF. “A healthy economy and, in these times, a full economic recovery, requires our continued vigilance in protecting American businesses and consumers from financial fraud.”

FFETF has set up 94 regional mortgage fraud working groups around the country.

The mortgage fraud faction of the task force has set its compass for loan modification schemes, foreclosure rescue scams, loan origination fraud, reverse mortgage cons, short sale frauds, and builder bailout schemes.

“Mortgage fraud trends show that the fraud evolves with the cycles of the housing market and varies by geographic region,” said Robb Adkins, executive director of FFETF. “Accordingly, the working group has focused its efforts in different, hard-hit regions throughout the country.”

The words “mortgage fraud” appear more frequently than any other white collar crime on the task force’s list of recent takedowns.

“Mortgage fraud has escalated into one of the most notorious crimes in the United States,” said Michael Stephens, HUD’s deputy inspector general.

“The many victims of mortgage fraud are borrowers, taxpayers, banks and mortgage companies, the government, and the economy as a whole. Mortgage fraud is even more harmful in that it damages public trust,” Stephens said.