Fraud is the knowing misrepresentation or concealment of a material fact with the intent to induce another to act to his or her detriment. Mortgage fraud occurs in the mortgage process when someone makes a material misstatement, omission, or misrepresentation that is relied upon by an underwriter or lender in determining whether to fund, purchase, or insure a loan. The federal government and the FBI investigate and then prosecute mortgage fraud in those cases where aspects of the fraud cross state lines.
Mortgage fraud can be roughly divided into two types. Sometimes “industry insiders” intentionally and falsely inflate the value of a property or issue loans contingent upon fictitious properties. The FBI calls this “loan origination fraud” and it is the most serious kind of mortgage fraud because of the high dollar losses involved. However, these crimes are on the decline because of tighter underwriting standards since the recent recession.
In the second type of fraud, a borrower commits the fraud by acquiring a house under false pretenses, for example, by misrepresenting his or her income or employment history to obtain a loan. Reports of this kind of fraud have increased rapidly since 2008 in connection with the increase in foreclosures and delinquencies. In fact, this type of fraud has displaced loan origination fraud as the focus of many offices of the FBI.
In its 2010 report on Mortgage Fraud, the FBI stated that California was a top state for mortgage fraud. As mentioned above, that is because of the foreclosure crisis in the Bay Area. The southern part of the San Francisco Bay Area, the San Jose/Santa Clara area, is one of the top five metropolitan areas in the United States for the highest per capita suspicious mortgage activity filings, according to a Treasury Department report.
The Treasury Department report noted that the following qualify as suspicious activities: pursuing different forms of loan workout or debt elimination strategies, loan modification attempts by borrowers or others targeting distressed homeowners, and inconsistencies between Social Security numbers submitted in loan documents.
If you are being investigated or charged with mortgage fraud either on the state or federal level, you should be aware that it is now handled as a serious offense. Choose a knowledgeable San Francisco federal mortgage fraud attorney to represent you in these proceedings. The experienced federal criminal defense attorneys at Dudek & Cintean can help you fight an inquiry by the FBI or charges brought by the United States. Call us at (415) 946-4020 for a consultation.
Call us at (415) 946-4020 for a consultation.
Alin Cintean, Attorney at Law and Richard Dudek, Attorney at Law
201 Spear St #1100
San Francisco, CA 94105
Phone: (415) 946-4020
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