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 JAN 21, 2007
FBI Reports on the Most Prevalent Mortgage Scam
According to FBI reports, it has been found that mortgage fraud showed a continued increase in 2006. This is in spite of recent increased attention to detail from both the financial industry and law enforcement. At the beginning of this month alone, the FBI had 938 ongoing investigations of mortgage fraud. This is up 120 cases over the 818 as of the end of the third quarter last year.


What is known as "fraud for profit" scams are the most common. These scams transpire when the thief purchases a house from a seller whom is legitimate- quite often with a stolen identity. The property is then sold to other thieves who pose as buyers after a corrupted appraiser gives the property an inflated value. Once the mortgage is secured at the appraised inflated value, the thieves split the proceeds from the loan with the sellers.

This type of fraud is recognized by the agency as a growing problem. The FBI has doubled its efforts in working with affiliated law enforcement and financial agencies. The FBI has seen this type of fraud perpetrated by organized crime as well as gangs.

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