530 Charged for Scamming Home Owners

Daily Real Estate News | Wednesday, October 10, 2012

After a yearlong probe, federal investigators say they’ve charged 530 people for allegedly defrauding more than 73,000 home owners who had fallen behind on their mortgage payments. The people charged are accused of allegedly duping the home owners into thinking that they could be rescued from foreclosure through the scammers’ fake rescue programs, investigators say.

The scams have resulted in 285 criminal cases of mortgage rescue scams and more than $1 billion in losses to home owners, U.S. Attorney General Eric Holder said Tuesday during a news conference.

“These comprehensive efforts represent a historic, governmentwide commitment to eradicating mortgage fraud and related offenses across the country,” Holder said.

Scammers would make bold promises to rescue struggling home owners from foreclosure, such as promising that if the home owners paid hefty fees they would have investors purchase the mortgage or negotiate the loan on their behalf with better terms.

The cases are part of a crackdown by federal investigators on mortgage-related fraud and scams that target home owners, a growing problem, according to the FBI.

“Distressed-homeowner schemes have displaced loan-origination fraud as the most common type of mortgage fraud in many areas in the country,” says FBI associate director Kevin Perkins. Two years ago, foreclosure scams accounted for about 4 percent of the mortgage fraud cases in the country, according to the FBI. Today, the percentage has jumped to nearly 20 percent.

Source: “Foreclosure Scam: 530 Charged for Allegedly Defrauding 73,000 Homeowners,” The Associated Press (Oct. 9, 2012) and “Feds Charged 530 in Crackdown on Mortgage Scams This Year, Holder Says,” The Washington Post (Oct. 9, 2012)

Stewart Real Estate Company


About kasey145

Redding California Real Estate Broker
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