Mortgage Fraud
By Esther Cho | 05/14/2012
Out of seven different categories of fraud reported by depository institutions, mortgage loan fraud (MLF) saw the second great increase from 2010 to 2011 and had the highest number of suspicious activity report (SAR) filings, according to a report from the Financial Crimes Enforcement Network. MLF SARs increased nearly 31 percent to 92,028 in 2011 compared to 70,472 in 2010. Consumer loan fraud saw an even greater increasing, spiking 127 percent after reaching 32,285 filings in 2011 compared to 14,194 SARs in 2010.
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By Esther Cho | 04/23/2012
The number of submissions for mortgage loan fraud suspicious activity reports (MLF SARs) for the full year of 2011 increased by 31 percent, or to 92,028, according to the Financial Crimes Enforcement Network (FinCEN). In 2010, 70,472 reports were submitted. Over the past several years, MLF SAR filings have been increasing on a yearly basis, with only 4,695 filings in 2001. In 2005, the number of filings made an upward climb to 25,988, then more than doubled 2009, when there were 67,507 filings.
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By Esther Cho | 04/11/2012
Mortgage foreclosure scams have surged 60 percent this year following newly launched federal programs, the Homeownership Preservation Foundation (HPF) announced.
"Regretfully, every new government initiative spawns a slew of foreclosure avoidance scams, often from the same cast of characters doing business under various names to avoid easy detection and identification," said Colleen Hernandez, CEO of HPF.
Hernandez added that most of these scams involve individuals purporting to offer foreclosure prevention assistance that trained HPF counselors provide at no cost.
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By Esther Cho | 04/09/2012
Mortgages are becoming more and more of a litigious matter, with the number of mortgage-related cases reaching an all-time high since being tracked in 2007, according to Mortgage Daily's 2011 fourth quarter Mortgage Litigation Index. At 244, the number of cases rose from 218 in the 2011 third quarter and from 151 over the same period a year earlier. Foreclosure-related litigation cases reached 99 and accounted for 40 percent of all cases. One attorney attributes the increase to a high level of awareness among borrowers that foreclosure-related issues can be litigated, sometimes successfully.
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By Esther Cho | 03/28/2012
States and metro areas known for being risky when it comes to mortgage fraud seem to be repeat offenders, according to the 2011 Annual Mortgage Fraud Risk report released by Interthinx.
The top six states with the highest levels of mortgage fraud risk in 2010 maintained their spots as the riskiest states into 2011, a trend also seen when looking at data for fraud in Metropolitan Statistical Areas (MSAs). Nevada, Arizona, Florida, California, Colorado, and Michigan were the six riskiest states for 2011 and 2010.
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By Esther Cho | 03/20/2012
A former chief financial officer of Taylor, Bean & Whitaker Mortgage (TBW) pleaded guilty Tuesday to making false statements and conspiring to commit bank and wire fraud for his role in a $2.9 billion scheme that contributed to the failures of TBW and Colonial Bank. Delton de Armas of Carrollton, Texas, faces a maximum penalty of 10 years in prison when he is sentenced on June 15, 2012. He admitted in court that from 2005 through August 2009, he and others schemed to defraud financial institutions that had invested in Ocala Funding.
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By Esther Cho | 03/20/2012
An Arizona woman was sentenced to 15 years in prison and ordered to pay $22 million in restitution after pleading guilty to various charges related to a mortgage fraud scheme and to charges of bankruptcy, wire, mail, and bank fraud in two separate indictments, according to a March 8 release from the U.S. attorney's office. Paige Kinney, also known as Jamie Lee Lawler, led a $40 million mortgage fraud scheme that targeted Countrywide Home loans and other lenders.
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By Esther Cho | 03/14/2012
The Securities and Exchange Commission (SEC) charged three former senior executives of Thornburg Mortgage for hiding the company's true financial state in an annual report. The plan backfired and caused a 90 percent value loss for the company in two weeks. The SEC alleges Thornburg's chief executive officer, chief financial officer, and chief accounting officer overstated the company's income by more than $400 million and falsely recorded a profit for the 2007 fourth quarter at the start of the financial crises.
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By Esther Cho | 03/06/2012
Financial institutions filed 19,934 mortgage loan fraud (MLF) suspicious activity reports (SARs) in the third quarter of 2011, a 20 percent increase compared to the third quarter last year, when 16,567 reports were filed, according to the Financial Crimes Enforcement Network (FinCEN) report of MLF SARs. In the third quarter of 2011, about 62 percent of the filings involved suspicious activities that started four or more years ago, compared to only 24 percent a year ago during the same time. The 2011 filings stem largely from mortgage repurchase demands and special filings generated by several depository institutions related to mortgages originated in the height of the housing boom, according to the report.
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By Esther Cho | 03/05/2012
Five California men were charged for allegedly operating a mortgage modification scheme and defrauding hundreds of victims under the business as CSFA Home Solutions, the Office of the Special Inspector General for the Troubled Asset Relief Program (SIGTARP) and Orange County, California, District Attorney Tony Rackauckas announced Friday in a statement. Between January 2009 and March 2012, the defendants are accused of creating numerous fraudulent loan modification businesses through which they purported to offer loan modification assistance.
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