Industry NewsMortgage

Utah may make mortgage fraud a felony

Nondisclosure state ranked second in nation for fraud

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Mortgage fraud could soon become a second-degree felony in Utah, prosecutable under the state's anti-racketeering statutes to allow the seizure of assets so they can be returned to victims. Utah Rep. Paul Ray, R-Clearfield, who authored a similar bill that died in March, said he's out to do something about the state's rate of mortgage fraud -- the second highest in the nation in 2005 on a per capita basis, according to a report by the Mortgage Asset Research Institute. According to MARI, Utah has been among the top five states in per capita mortgage fraud since 2001, despite having increased requirements for professional licensing and education and conducting more rigorous enforcement. Ray said amendments to his previous mortgage fraud bill, HB 159, made it too broad and "bloated it down with fiscal costs" for the state. The latest version of the bill is more limited in scope, criminalizing mortgage fraud and creating a special prosecutor and two investigators at an annual cost of $2...