Mortgage Fraud

A federal grand jury has indicted Rolando Alonzo Cousins of Bowie, Maryland, for conspiracy to commit mail fraud, mail fraud, and money laundering, in connection with a “massive” mortgage fraud scheme that promised to help homeowners facing foreclosure keep their homes and repair their damaged credit, but left them homeless and with no equity. 

We have a bit of news, finally, about the Financial Fraud Enforcement Task Force, which the Obama administration established at the end of last year. Representatives of the Task Force met in Miami yesterday for the first of a series of Mortgage Fraud Summits. Miami is a particularly appropriate venue for the summit, given that it has a high rate of mortgage fraud.

A report released today by the Financial Crimes Enforcement Network (“FinCEN”) shows a continuing increase in suspicious activity related to possible mortgage loan fraud.

The Brooklyn, N.Y., District Attorney, Charles Hynes, has brought charges against 12 people allegedly involved in various mortgage and real estate scams – including a number of lawyers. The allegations involving attorneys, according to the D.A., tell some disturbing stories:

One of the government officials testifying today before the Financial Crisis Inquiry Commission was U.S. Attorney General Eric Holder. Among the interesting things Holder had to say were the following:

If you still don’t believe that mortgage fraud is a big deal, you’re just not paying attention. Look at these four mortgage fraud stories from around the country that took place today: 

Yesterday, we chose the “Mortgage Mess” as the 8^th most significant Financial Fraud Law issue of 2009. Today, Kevin L. Perkins, the FBI’s Assistant Director, Criminal Investigative Division, testified before the Senate Judicial Committee about the FBI’s efforts to combat significant financial crimes.

Subprime mortgages, overpriced homes, excessive valuations, poorly documented loans, the severe drop in the value of houses across the country, and continuing prosecutions of mortgage fraud – including mortgage relief service scams – make

As we’ve pointed out, the federal government is devoting significant resources to identifying and holding accountable those who committed or allegedly committed fraud in the subprime industry. For example, the Securities and Exchange Commission has brought mortgage-related enforcement actions against Countrywide Financial CEO Angelo Mozilo, and senior executives, including the CEO, of American Home Mortgage Investment Corp. 

Mortgage foreclosure actions are continuing at a rapid rate. Overwhelmed courts are struggling to keep people in their homes, while treating lenders fairly. A recent decision by a New York State Supreme Court justice shows the dilemma facing the judicial system and the problems both borrowers and lenders have to address. It also offers what some may view