HW Media connects and informs decision makers across the housing economy. Professionals rely on HW Media for breaking news, reporting, and industry data and rankings. Moving the Housing Market Forward.
Reverse Mortgage

New Mortgage Fraud Targets Title and Escrow, Says FinCEN

Mortgage Fraud was among the top trends in the filing of suspicious activity reports (SARs) involving title and escrow companies, the Financial Crimes Enforcement Network (FinCEN) announced today. Almost all SARs were filed through mandatory reporting from outside of the title and escrow business, the research finds. 

FinCEN conducted a study examining criminal risks in the residential real estate market from 2003-2011 by analyzing the filing of SARs involving title and escrow companies. The study began with a goal of identifying gaps in the housing finance system that allow for criminal activity and abuse to slip through. 

“This first baseline study will help inform our ongoing efforts to identify regulatory gaps that criminals look to take advantage of,” said FinCEN Director James Freis. “We can now more efficiently and effectively address those gaps and mitigate those risks through public awareness, support to law enforcement, or appropriate regulatory action.”

The study found mortgage fraud was among the top reasons for reporting suspicious activity. Banks and Money Services Businesses filing against title and escrow companies in regard to mortgage fraud accounted for thousands of cases reported. Structuring and false statement were also among the most frequent activities reported. 

In the nine years over which the study was conducted, the real estate industry saw nearly 22,000 SARs and Suspicious Activity Report by Money Services Business (SAR-MSBs) forms filed. For roughly every 750 reports filed from outside the industry, one was filed by the industry itself. 

The biggest trend for SARs filed on real estate and escrow-related businesses involved mortgage loan fraud. False statements were another trend in reported activities, with mortgage loan fraud accompanying more than 93% of the false statement reports. 

Read the FinCEN study here

Written by Erin Hegarty

Most Related Articles

Celink to Pay $4.25 Million to Settle Federal HECM Lawsuit HW+

Compu-Link Corporation (Celink) has agreed to pay a $4.25 million civil settlement to the United States to resolve allegations made by the U.S. Justice Department relating to a False Claims Act violation related to its servicing of Home Equity Conversion Mortgage (HECM) products. This is according to a press release from the United States Attorney’s […]

Jan 01, 2019 By

Latest Articles

HW+ Member Spotlight: Tom O’Donoghue HW+

This week’s HW+ member spotlight features Tom O’Donoghue, owner at Reverse Loans Now. O’Donoghue has been in mortgage banking for more than 30 years and has been helping and committed to working with Senior Citizens for the last seven years. HW Media: What is your current favorite HW+ article and why? Tom O’Donoghue: How inflation could be a net benefit […]

Aug 12, 2022 By