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  1. #1
    Senior Member JohnDoe2's Avatar
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    1,215 Charged in Mortgage Fraud Schemes

    Attorney General Eric Holder Speaks at the Operation Stolen Dreams Press Conference

    Washington, D.C. ~ Thursday, June 17, 2010Good morning, and thank you all for being here.

    Last November, President Obama created the Financial Fraud Enforcement Task Force year to wage an aggressive, coordinated fight against financial crimes. One of the prime focuses we identified at the outset was combating mortgage fraud, and I am joined by several key partners in that fight today: IRS’s Criminal Investigation Deputy Director Sallie Cooper, Special Agent in Charge of the U.S. Secret Service Criminal Investigative Division Ken Jenkins, FTC Commissioner Edith Ramirez, Housing and Urban Development Inspector General Ken Donohue, FBI Director Bob Mueller, Illinois Attorney General Lisa Madigan, Chief Postal Inspector Bill Gilligan and Director of the Treasury Department’s Financial Crimes Enforcement Network Jim Freis.

    We are here to announce the results of Operation Stolen Dreams – a three and a half month takedown of mortgage fraud schemes throughout the country.

    This operation began on March 1, and to date involved 1,215 criminal defendants nationwide, defendants who were allegedly responsible for more than $2.3 billion in losses. In addition, the operation involved 191 civil enforcement actions through which more than $147 million has been ordered recovered, with still millions more pending court approval. This represents the largest collective enforcement effort ever brought to bear in confronting mortgage fraud. The success of this operation is a direct result of our unprecedented focus not just on federal criminal cases, but also on civil enforcement, recovering funds for victims and increasing cooperation with state and local partners.

    The staggering totals from this sweep highlight the mortgage fraud trends we are seeing around the country. We have seen mortgage fraud take on all shapes and sizes – from schemes that ensnared the elderly to fraudsters who targeted immigrant communities. We have seen cases that have resulted in dozens of foreclosures and millions in losses, as well as fraudsters who have bankrupted entire companies and national lenders who were not playing by the rules.

    In Miami, just yesterday we unsealed an indictment and arrested two defendants who allegedly targeted the Haitian-American community, often claiming they would assist them with immigration and housing issues, but then instead using victims’ personal information to produce false documents to obtain mortgage loans.

    In Chico, California, a prominent home builder, caught with a significant amount of unsold new homes as the housing market cooled, allegedly used straw buyers to sell his houses at inflated prices with undisclosed sales rebates. This scheme inflated prices on other homes in the area, creating artificially high comparable sales and affecting the overall new-home market. To date, thirty-eight of the homes have fallen into foreclosure and ten more have been the subject of short sales – all in one city.

    In Detroit, just yesterday we charged several individuals who are part of a more than $100 million, 70-plus person "ghost loans" scheme. The conspirators posed as mortgage brokers, appraisers, real estate agents and title agents and used straw buyers to obtain around 500 mortgages on only 180 properties.

    The list goes on and on. The breadth of the fraud is truly astonishing, which is why we launched an unmatched effort to fight it. The President’s Financial Fraud Enforcement Task Force is the broadest coalition of law enforcement, investigatory and regulatory agencies ever established to combat fraud. All of these partner agencies, as well as state and local partners, are working together to ensure that no stone is left unturned when it comes to fighting this kind of crime.

    In the past few months, task force members have traveled to cities heavily affected by mortgage fraud to hear from industry insiders and community members on how mortgage fraud has impacted their region. In Phoenix, I listened to the concerns of citizens, and heard first hand about attempts to take advantage of homeowners’ desperation following the collapse of the housing market.

    We know that mortgage fraud ruins lives, destroys families and devastates whole communities, so attacking the problem from every possible angle is vital. These schemes are despicable, they are dangerous to our economy and they will not be tolerated.

    This takedown is just the latest effort in our ongoing fight. Looking toward the future, the Department of Justice has requested $178 million in our FY2011 budget to fight mortgage fraud, an increase of over $18.4 million. The FBI has over 3,000 pending mortgage fraud cases, almost double the figure from FY08, and those numbers will only continue to grow. Additionally, the task force is working with consumer groups to increase financial literacy and better educate homeowners about warning signs of scams.

    Finally, I end with two important messages. First, to homeowners who are struggling to make payments or looking to refinance your homes – there are legitimate government programs out there to help you. Visit StopFraud.gov for resources, and if you suspect suspicious activity, report it. An educated public is one of our most important partners in the fight against mortgage fraud.

    Secondly, let today’s takedown send a strong message to any would-be fraudsters: If you prey on vulnerable homeowners or engage in fraudulent conduct, we will find you and we will bring you to justice. You will pay for your schemes.

    I’d now like to turn it over to FBI Director Bob Mueller.

    http://www.justice.gov/ag/speeches/2010 ... 00617.html
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  2. #2
    Senior Member JohnDoe2's Avatar
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    Feds have made nearly 500 arrests in mortgage fraud probe

    Posted 41m ago
    By Pete Yost, Associated Press

    WASHINGTON — The Justice Department announced Thursday that investigators have made nearly 500 arrests since March in a major crackdown on mortgage fraud.

    The nationwide initiative called Operation Stolen Dreams is the largest collective enforcement effort aimed at confronting the problem of mortgage fraud, Attorney General Eric Holder told a news conference. It involves 1,215 criminal defendants in cases that uncovered more than $2.3 billion in losses.

    The Justice Department also has engaged in civil enforcement actions to recover more than $147 million in the operation.

    Two Countrywide companies will pay $108 million to settle allegations that they inflated the fees that homeowners paid.

    Hundreds of FBI agents are working on task forces with other law enforcement agencies to combat a type of crime that poses "a risk to our economic stability" as a nation, FBI Director Robert Mueller told the news conference.

    The Justice Department said the probe has resulted in significant criminal cases in Chico, Calif.; Miami; Detroit; Duluth, Minn.; New Jersey, and Atlanta.

    In Detroit, investigators broke up a "ghost loan" mortgage scheme in which the conspirators allegedly posed as mortgage brokers, appraisers, real estate and title agents. They recruited over 108 straw buyers and obtained some 500 mortgages totaling more than $100 million.

    The alleged mortgage fraud scheme in Miami targeted the Haitian-American community. One of the defendants advertised herself as someone who could assist with immigration issues. The defendant also said she could provide assistance with the manager of a government-sponsored housing program. The defendants in the case used the personal information they gathered to fraudulently buy various properties without the permission of Haitian residents.

    In Chico, Calif., one of the biggest home builders in the area was sitting on unsold new homes as the housing market cooled in 2006. The builder sold the homes to straw buyers at inflated prices, then rebated tens of thousands of dollars on each home to shell companies controlled by the buyers' agents. The lenders were unaware of the rebates. The Justice Department said that to date, 38 of the homes are in foreclosure.

    In New Jersey, the servicing manager of U.S. Mortgage pleaded guilty for his role in the fraudulent sale of more than $136 million in mortgage loans to Fannie Mae and other investors.
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    http://www.usatoday.com/money/economy/h ... ests_N.htm
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  3. #3
    Senior Member JohnDoe2's Avatar
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    Jun 17, 2010

    1,215 charged in mortgage frauds worth $2.3B

    05:05 PM

    The Justice Department today announced that 1,215 people have been charged for allegedly fraudulent mortgage schemes worth $2.3 billion.

    In a statement, Attorney General Eric Holder called the three-month investigation "the largest collective enforcement effort ever brought to bear in confronting mortgage fraud." He said $147 million had been recovered through civil action, with ""still millions more pending court approval."

    Since March, nearly 500 people have been arrested.

    http://content.usatoday.com/communities ... rth-23b-/1
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