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07/08/2009

News / FBI Issues 2008 Mortgage Fraud Report

According to the Federal Bureau of Investigation’s 2008 Mortgage Fraud Report, released today, mortgage fraud Suspicious Activity Reports (SARs) referred to law enforcement increased 36 percent to 63,713 during fiscal year (FY) 2008, compared to 46,717 reports in FY 2007. While the total dollar loss attributed to mortgage fraud is unknown, financial institutions reported losses of at least $1.4 billion, an increase of 83.4 percent from FY 2007.

“Mortgage fraud hurts borrowers, financial institutions, and legitimate homeowners,” said Assistant Director Kevin Perkins, FBI Criminal Investigative Division. “The FBI, in conjunction with our law enforcement, regulatory, and industry partners, continues to diligently pursue perpetrators of mortgage fraud schemes.”

Other key findings presented in the report include:

* Sixty-three percent (1,035) of all pending FBI mortgage fraud investigations during FY 2008 involved dollar losses totaling more than $1 million.
* More than 3.1 million foreclosure filings were reported on approximately 2.3 million properties nationally during FY 2008, up 81 percent from FY 2007 and 225 percent from FY 2006.
* As of FY 2008, the western region of the United States had the most pending FBI mortgage fraud-related investigations.
* The top 10 mortgage fraud states for 2008 were California, Illinois, Texas, Georgia, Ohio, Colorado, Maryland, Florida, Missouri, and New York.
* Rhode Island, Massachusetts, Pennsylvania, and the District of Columbia were newly identified as having significant mortgage fraud problems.
* Criminals continued using old schemes, including property flipping, builder-bailouts, short sales, and foreclosure rescues. Additionally, in response to tighter lending practices, they facilitated new schemes, such as reverse mortgage fraud, credit enhancements, condo conversion, loan modifications, and pump and pay.

The entire report is available at www.fbi.gov. While there, sign up for e-mail alerts to ensure you receive the latest information about the FBI.

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