Mortgage Fraud Activity Reports Jump 20% in Q3 says FinCen

The Financial Crimes Enforcement Network (FinCEN) says the number of mortgage loan fraud suspicious activity reports (SARs) jumped 20% in the third quarter of 2011.

Institutions filed 19,934 MLF SARs in the third quarter of 2011 up from 16,567 filed in the same quarter of 2010 according to the report.

“As housing markets look to recover, criminals persist in their efforts to prey on struggling homeowners, while financial institutions continue to uncover apparent fraud as they work through their portfolios of earlier mortgages now in default,” said FinCEN Director James H. Freis, Jr. “FinCEN will continue to monitor these reports and work closely with law enforcement to help them track illicit actors.”

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The increase in filings stems largely from mortgage repurchase demands and special filings generated by several depository institutions related to mortgages originated in the height of the housing boom. This majority of filings involving past activity compares with just 24 percent of MLF SARs reported in the third quarter of 2010 where the activity started four or more years ago.

he top five counties ranked per capita and by SAR subject in the third quarter were Santa Clara County, California; Honolulu County, Hawaii; Orange County, California; San Bernardino County, California; and Palm Beach County, Florida. The top five states ranked by per capita and by SAR subject were: Hawaii, California, Nevada, Florida, and Delaware.

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