Industry NewsMortgage

Mortgage fraud reports level off

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After six years of double-digit growth, reports of suspected cases of mortgage fraud by lenders leveled off in the first half of 2009 but remained at a historically high level, acccording to a government report released today.The Financial Crimes Enforcement Network (FinCEN) said depository institutions reported 32,926 cases of suspected mortgage fraud in the first half of 2009, an increase of less than 1 percent from the same period in 2008.In a previous report, FinCEN said it received 64,816 reports of cases of suspected mortgage fraud in all of 2008, a 23 percent increase from the year before but the smallest annual increase since 2002 (see story).After peaking at 93 percent in 2004, growth in suspicious activity reports related to mortgage fraud ranged from 41 percent to 44 percent from 2005-07.During the boom, many mortgage fraud schemes relied on selling homes at inflated prices to straw buyers -- a ploy more likely to raise red flags with lenders today.Falling home prices can al...