Georgia ranks highest in the nation for reported mortgage fraud, South Carolina is second-highest and Florida is third, according to the Mortgage Asset Research Institute’s seventh annual report.

Mortgage fraud continues to increase in the United States, with the number of suspicious activity reports to the Federal Bureau of Investigation in 2004 almost triple those in 2003, according to a report by the FBI released in May.

The MARI report, prepared for the Mortgage Bankers Association, measures mortgage fraud for the years 2001 through 2004. It examines the current composition of residential mortgage fraud and misrepresentation in the United States.

The fourth-hottest spot in the company for mortgage fraud is Utah, the fifth is North Carolina and the sixth is Missouri, the report said.

The Top Ten of mortgage fraud is rounded out by Nevada, seventh in mortgage fraud, Texas, which is eighth, Illinois, which is ninth, and Michigan, which is 10th, according to the report.

The report noted that for most of the past decade, fraud rates from California and Florida have led the nation by substantial margins. In the past few years, Georgia has led the nation for reported incidents, and recently South Carolina moved into second position by a substantial margin, the report said.

Florida continues to have a high fraud score, but is no longer entrenched in its historical second-place position on the list, MARI said.

Reported fraud in California has dropped “significantly,” the report said, but many of its problems are likely being masked by high real estate appreciation.

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