USA Financial Task Force for Mortgage Fraud
Posted: Monday, November 23, 2009
by Aurelia Masterson
Panama Legal
Executive Summary - The USA is putting together a financial task force to combat widespread mortgage fraud. This was done by executive order by Obama. The task force will include representatives from: The US Attorney Generals Office, Justice Department, Housing and Urban Development, Secret Service, FBI, IRS, Securities Exchange Commission and other agencies. The statement from Attorney General Holder reads as follows:
The number of mortgage fraud investigations handled by the FBI have more than doubled in the past three years and Obama recently doubled the resources available to the FBI to investigate and prosecute mortgage and financial frauds. The new practices call for cooperation between federal agencies, state attorney generals and district attorneys. Now the FBI has 2400 cases of mortgage fraud it is investigating.
This past week there were 105 arrests and arrest warrants involving Federal Agents for mortgage fraud in Florida, mostly Central Florida. The offenses involved straw buyers, fictitious buyers and inflation of income and prices fraudulently. The Federal Agents are saying those convicted could get 30 years in jail. The Federal Agents are saying the recent arrests are just the start and their work is not yet done in Florida, which is referred to as ground zero for mortgage fraud.
Discussion – What happened in the USA is fraudsters realized they could hoodwink banks and lenders into giving them much more money on a mortgage than the house was worth. They also lied about the borrowers income to justify the loan. Once they got the money they would walk away from the house letting it go into foreclosure thinking that is the way things work and the heck with the lender. If the fraudsters took the time to have someone live in the house and make the payments for even six months they might have escaped being charged criminally.
The irony here is that the lenders are not being charged. Anyone can see that they failed to do their due diligence and by negligence were complicit. What is going to happen is a witch-hunt will ensue for these mortgage fraudsters and they will lose all their assets and wind up with substantial prison sentences based on the dollar value of the fraudulent mortgages in addition to the methods and tactics they used to get the loans. It is worth saying that these fraudsters drive up the cost of mortgages for the honest people who have to pay higher fees to cover the fraud losses caused by these fraudsters.
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