Mortgage fraud is on the rise according to 2009 third quarter estimates. The Departments of Justice, Treasury, Housing and Urban Development (HUD), and the Securities and Exchange Commission (SEC) created a new agency, Financial Fraud Enforcement Task Force, to combat this growing problem. Emerging trends in mortgage fraud encouraged the agency's creation to avoid even more flaws in today's still bruised housing market.
Third quarter of last year revealed a 7.5 percent increase in mortgage fraud, compared to a year earlier. Attorney generals compiled information about the growing trend and attributed it to the slumping housing market, but not all fraud filings were actually from the third quarter, some were more than a year old.
The new task agency is committed to informing financial institutions of emerging schemes, increasing enforcement actions and helping educate those consumers that might be at risk for fraud, or could be a victim of fraud because of a faulty loan modification scheme or fraudulent foreclosure rescue scam.
"Treasury's Financial Crimes Enforcement Network has pursued more than 100 cases, partnering with 31 state attorneys general who are aggressively cracking down on mortgage fraud and are shutting down suspect companies," stated Treasury Secretary, Timothy Geithner in a news conference regarding the new task force agency.
Almost half of the reported frauds came from California with a whopping 42 precent of illegal financial activity. Other big cities that were hit the hardest with fraudulent mortgage scams were Miami and New York. Florida, as a whole, was at the top of the list.
According to the Financial Crimes Enforcement Network of the U.S. Department of Treasury (FinCen) "Examples of possible signs of fraudulent activity, such as requiring that fees be paid before services are provided, are listed in the advisory. In addition, the advisory requests that financial institutions include the term "foreclosure rescue scam" in the narrative sections of all relevant SARs."
Source: Financial Crimes Enforcement Network of the U.S. Department of Treasury
Written by Amy Munday
Huliq.com
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