Mortgage and Home Repair Fraud

For more information on mortgage and home repair fraud, select the source and summary below:

Informational Publications and Websites: 

1. Federal Bureau of Investigation (FBI) - Mortgage Fraud

        From foreclosure frauds to subprime shenanigans, mortgage fraud is a growing crime threat that is hurting homeowners, businesses, and the national economy. The FBI has developed new ways to detect and combat mortgage fraud, including collecting and analyzing data to spot emerging trends and patterns. It focuses on using the full array of investigative techniques to find and stop criminals before the fact, rather than after the damage has been done. This information website provides statistics, the latest mortgage fraud scams, and how to protect yourself from being a victim of fraud.

2. Federal Deposit Insurance Corporation, Protect Yourself From Mortgage Scams, FDIC Consumer News.

The Federal Deposit Insurance Corporation (FDIC) preserves and promotes public confidence in the U.S. financial system by (1) insuring deposits in banks and thrift institutions for at least $250,000; (2) by identifying, monitoring and addressing risks to the deposit insurance funds; and (3) by limiting the effect on the economy and the financial system when a bank or thrift institution fails. FDIC Consumer News wants to remind the public to watch out for scammers who falsely claim to be lenders, loan servicers, financial counselors, mortgage consultants, loan brokers or representatives of government agencies who can help with your mortgage. This webpage lists and explains common warning signs of fraudulent offers of mortgage assistance. It also includes an audio MP3.

3. Fannie Mae - Mortgage Fraud Prevention

        Fannie Mae, one of the leading lenders, provides red flags and helpful tools, recent news, and an anti-fraud partnership training series. The training series features tutorials including:

4. Combating Home Repair Fraud: Preventing the Victimization of the Elderly, Jesse De Los Santos, Investigator, Bexar County District Attorney’s Office.

This newsletter discusses why home repair scams are an increasing problem for the elderly population. The author addresses ways that the elderly population can take control and become better protected from scams. These pointers are provided to help minimize the exposure of fraud within the elderly population.

5. Internal Revenue Service (IRS) - Examples of Mortgage and Real Estate Fraud Investigations

This website provides examples of mortgage and real estate fraud investigations are written from public record documents on file in the court records in the judicial district in which the cases were prosecuted.

6. Office of the Attorney General of Florida - Mortgage Fraud

        The Attorney General is committed to investigating any business that deceives or defrauds a consumer in the mortgage or foreclosure process and offers the following consumer tips:

7. National Consumers League - Top 10 red flags of home repair scams

        This site provides the top 10 things to look for when identifying contractor scams including:

8. Safety cops online 

        Safety Cops is dedicated to increasing public awareness of the tactics and methods used by criminals, and to offer advice and suggestions to keep you from becoming a victim. At Safety Cops we believe that information is the most powerful weapon you can arm yourself with. Please take a moment to  check out the many features written by "Real Cops" about "Real Crime", giving "Real Advice"

Scholarly Articles, Research, and Analysis:

1. The 2015 Florida Statutes: Mortgage Fraud Section 817.545

2. Manuel Adelino, Antoinette Schoar, Felipe Severino, Loan Originations and Defaults in the Mortgage Crisis, NBER Working Paper No. 21320 Issued in July 2015.

        This paper discusses how the origination of purchase mortgages increased across the whole income distribution during the 2002-2006 housing boom, and did not flow disproportionately to low-income borrowers. In addition, middle- and high-income, as well as middle- and high-credit-score borrowers (not the poor), represent a larger fraction of delinquencies in the crisis relative to earlier periods. The results are inconsistent with the idea that distortions in the origination of credit caused the housing boom and the crisis and are more consistent with an expectations-based view where both home buyers and lenders were buying into increasing housing values and defaulted once prices dropped.

Online Access Here

3. Arthur Durst, Property and Mortgage Fraud Under the Mandatory Victims Restitution Act: What is Stolen and When is it Returned, William and Mary Business Law Review Vol. 5 Issue 1. (2014)

     The United States Circuit Courts of Appeals are split on how to calculate restitution in a criminal loan fraud situation where collateral is involved. This trend is best illustrated in cases involving mortgage fraud. The split stems from disagreement over how to account for the lender’s receipt of collateral property. The Third, Seventh, Eighth, and Tenth Circuit Courts of

Appeals consider the property returned when the person defrauded receives cash from the sale of collateral property. The Second, Fifth, and Ninth Circuits deem the property returned when the lender takes ownership of the collateral property. This Note argues that the former conception of the off-set value ought to govern. This Note also supports a view of property that considers the lender’s lost opportunity from fraud. Even when restitution is mandatory, the governing rule should take into account the alternative investment the lender would have made if there had been no fraud.

Online Access Here

4. Audit of the Department of Justice’s Efforts to Address Mortgage Fraud, U.S. Department of Justice Office of the Inspector General Audit Division, Audit Report 14-12 (March 2014).

The Department of Justice (DOJ) and its components, particularly the FBI, United States Attorneys’ Offices (USAO), Criminal Division, and Civil Division, along with the DOJ-led interagency Financial Fraud Enforcement Task Force (FFETF), play an important role in combating mortgage fraud through civil litigation and criminal investigation and prosecution. The objective of this audit was to assess DOJ’s approach and enforcement efforts in addressing mortgage fraud generally between fiscal years (FY) 2009 and 2011.

Full Report Online

5. Eric P. Baumer, Ashley N. Arnio & Kevin T. Wolff, Assessing the Role of Mortgage Fraud, Confluence, and Spillover in the Contemporary Foreclosure Crisis, 23 Housing Policy Debate 2, 299-327 (2013). DOI: 10.1080/10511482.2012.727843

This study explores three features of the contemporary foreclosure crisis that have been highlighted in the literature but relatively neglected in existing empirical research. First, the study evaluates the capacity for levels of mortgage fraud to serve as a potentially important leading indicator of significant foreclosure activity. Second, the study examines the possibility that high foreclosure rates may exhibit spatial dependence, affecting the foreclosure realities of surrounding areas in ways similar to how they have been shown to influence housing prices. Finally, the research considers whether key factors emphasized in scholarly and policy discussions interacted to produce particularly high rates of foreclosure in some areas of the United States. The findings indicate that foreclosure rates in 2008 were significantly higher in United States. counties where “profit-motivated” mortgage fraud was more prevalent several years earlier (i.e., 2004–2006). This study also reveals that, net of a wide variety of other factors, high rates of foreclosure can adversely affect nearby counties by elevating their foreclosure rates. Overall, spatial variation in foreclosure rates appears to be due to additive effects of selected factors rather than interactions of those factors, although the study does show that affordable housing can lessen the tendency for high levels of subprime lending to translate into high foreclosure rates.

Taylor & Francis Online

6. Mario Davila, James W. Marquart & Janet L. Mullings, Beyond Mother Nature: Contractor Fraud in the Wake of Natural Disasters, 26 Deviant Behavior 3, 271-293 (2005) DOI: 10.1080/01639620590927623

Fraud is a complex and multifaceted crime and the financial losses related to its numerous forms are enormous. Despite the well-publicized accounts of property and person-related crime, the financial losses and the total number of fraud victims far exceeds “normal” crime in America. Natural disasters present fraudsters a rich environment for contractor fraud. Prevention efforts can warn citizens, especially the elderly, that natural disasters present unique opportunities for criminal acts. The research findings reported here represent the first step in a developing research agenda on the relationship between natural disasters and criminal victimization.

Taylor & Francis Online

7. Florida TRIAD “Protect Yourself From Home Repair Fraud” Brochure

        This brochure provides important tips and resources on how to protect yourself from home repair fraud.

English Brochure        Spanish Brochure

8. Odette Williamson, Protecting Elderly Homeowners from Predatory Mortgage Lenders, 34 Clearinghouse Rev. 297.  

Elderly and low-income Americans are at risk of losing their homes because of predatory mortgage lending practices. Elderly homeowners constitute a very attractive target for predatory lenders. This article analyzes the statistics of elderly homeowners that fall victim to predatory mortgage lenders, the ways in which it happens, and how to protect them.

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9. Katherine C. Pearson, Have I Got A Deal For You! Predatory Lending Practices And The Elderly Borrower, Fall 2004 Presentation on Financial Exploitation of the Elderly for Pennsylvania Bar Institute.

        This article examines and defines predatory lending, discusses appropriate responses to predatory lending practices, current and proposed legislation, as well as the role of counsel for the borrower. Bankruptcy and reverse mortgages are explained and a selected annotated bibliography is provided.

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