10 Oct 2012
An
estimated 73,000 distressed home owners have been duped for more $ 1
billion nearly by 530 mortgage companies run by scam artists since 2011,
the U.S justice department said in a press release.
In the statement the justice department said 530 criminal defendants were charged in the year long investigations.
“These comprehensive efforts represent an historic, government-wide commitment to eradicating mortgage fraud and related offenses,” says Attorney General Eric Holder.
Read the full text of the press release…
Talk about going from bad to worse—more than 4,000 financially strapped homeowners recently lost at least $7 million to a California business that allegedly operated a loan modification scam. Last month, 11 representatives of that company were federally indicted, but by that time, many of the victims had already lost their homes.
Today, to help protect distressed homeowners around the country from a rising tide of fraud schemes—and to raise awareness about them—the FBI joined the Department of Justice, the Department of Housing and Urban Development, and the Federal Trade Commission (FTC) in announcing the results of the Distressed Homeowner Initiative. This initiative was launched by the Bureau—co-chair of the Financial Fraud Enforcement Task Force’s Mortgage Fraud Working Group—in October 2011.
This initiative combines the resources of federal, state, and local law enforcement agencies and the efforts of regulatory agencies to target perpetrators both criminally and civilly. Over 200 companies have been shut down, and criminal charges were filed against 530 defendants. These cases involved losses of more than $1 billion from more than 73,000 victims across the country.
Said Associate Deputy Director Kevin Perkins, “In contrast with previous initiatives, where the fraud victims primarily were lenders, the focus here is on individual homeowners, many times at their most vulnerable point.”
Based on intelligence from multiple sources, schemes targeting distressed homeowners have emerged throughout the country, and while the majority of FBI mortgage fraud cases involve loan origination fraud, we’ve had a 300 percent increase over the past three years in cases involving distressed homeowner fraud.
And with current mortgage data showing that 22.3 percent of residential properties with mortgages are “underwater” —when borrowers owe more than their homes are worth—we believe that fraudsters will certainly continue to target distressed homeowners.
We’ve also noticed a disturbing trend among these cases—an increasing number of lawyers playing primary or secondary roles in the fraud. In 2010, the FTC issued a rule that prohibited companies that offer loan modification or other types of mortgage assistance services from asking for fees in advance (some states have similar regulations), but with an exemption in some instances for lawyers performing legal work. Criminals targeting distressed homeowners try to circumvent the rules by using attorneys—which by itself adds an air of legitimacy to their fraudulent schemes—and calling their upfront fees “legal retainers.
Sample of flyers and a webpage used by
unscrupulous solicitors looking for victims. Some of their dishonest
claims are circled in red.
“These comprehensive efforts represent an historic, government-wide commitment to eradicating mortgage fraud and related offenses,” says Attorney General Eric Holder.
Read the full text of the press release…
Talk about going from bad to worse—more than 4,000 financially strapped homeowners recently lost at least $7 million to a California business that allegedly operated a loan modification scam. Last month, 11 representatives of that company were federally indicted, but by that time, many of the victims had already lost their homes.
Today, to help protect distressed homeowners around the country from a rising tide of fraud schemes—and to raise awareness about them—the FBI joined the Department of Justice, the Department of Housing and Urban Development, and the Federal Trade Commission (FTC) in announcing the results of the Distressed Homeowner Initiative. This initiative was launched by the Bureau—co-chair of the Financial Fraud Enforcement Task Force’s Mortgage Fraud Working Group—in October 2011.
This initiative combines the resources of federal, state, and local law enforcement agencies and the efforts of regulatory agencies to target perpetrators both criminally and civilly. Over 200 companies have been shut down, and criminal charges were filed against 530 defendants. These cases involved losses of more than $1 billion from more than 73,000 victims across the country.
Said Associate Deputy Director Kevin Perkins, “In contrast with previous initiatives, where the fraud victims primarily were lenders, the focus here is on individual homeowners, many times at their most vulnerable point.”
Based on intelligence from multiple sources, schemes targeting distressed homeowners have emerged throughout the country, and while the majority of FBI mortgage fraud cases involve loan origination fraud, we’ve had a 300 percent increase over the past three years in cases involving distressed homeowner fraud.
And with current mortgage data showing that 22.3 percent of residential properties with mortgages are “underwater” —when borrowers owe more than their homes are worth—we believe that fraudsters will certainly continue to target distressed homeowners.
We’ve also noticed a disturbing trend among these cases—an increasing number of lawyers playing primary or secondary roles in the fraud. In 2010, the FTC issued a rule that prohibited companies that offer loan modification or other types of mortgage assistance services from asking for fees in advance (some states have similar regulations), but with an exemption in some instances for lawyers performing legal work. Criminals targeting distressed homeowners try to circumvent the rules by using attorneys—which by itself adds an air of legitimacy to their fraudulent schemes—and calling their upfront fees “legal retainers.
2 comments:
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Mortgage Leads Marketing
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