US Mortgage Scams double, as reported by the FBI!
Posted by markharrison on January 14, 2008
According to the FBI, mortgage fraud convictions in the USA have over doubled in the last year.
The list of offences include falsifying of mortgage application documents by brokers and lenders… in the hope that the customer would take out too big a loan, thus earning bigger fees. (Because of securitisation in the States, the company that “lends” the mortgage seldom ends up “holding the loan” – the loans are sold off to outside investors.)
USA Today reports that in the last year, “[The FBI] created 34 mortgage fraud task forces and working groups with investigators from departments including Housing and Urban Development, Treasury and Veterans Affairs.”
I have to admit, I know of several people who have (against my advice) lied on their mortgage applications – to have the bank repossess your house is bad enough, but to have Mulder and Scully haul you off for mortgage fraud feels worse. It’s going to be interesting to see whether the UK government puts together a task force for some “trophy prosecutions”.