News
Fraudulent Lenders Face Tougher Penalties, as U.S. Mulls New SAR Requirements
By Matt Squire
printMortgage lenders will face greater scrutiny from law enforcement agencies and federal regulators following the passage of an anti-mortgage fraud bill and the announcement that further regulations may be coming. President Obama signed the measure, called the Fraud Enforcement and Recovery Act (FERA), on Wednesday. The act allocated additional funding to combating mortgage fraud and amends criminal statutes in an effort to give investigators and prosecutors more leeway in handling cases tied to fraudulent mortgages. Specifically, the law allows investigators to use a bank fraud law against fraudulent mortgage lenders that would otherwise be prosecuted for mail or wire fraud....
TO READ THE FULL STORY
Related News
The U.S. Treasury Department finalized rules Thursday requiring federal home-loan banks to implement anti-money laundering controls and report suspicious activity.
Plans by the Obama administration to pursue civil and criminal cases against institutions that illegally promoted mortgage-backed securities could also bring scrutiny to anti-money laundering compliance officers.
The number of bank regulatory reports of suspected cases of commercial real estate fraud rose nearly threefold between 2007 and last year, the U.S. Treasury Department said Wednesday.
The U.S. Treasury Department said Monday it plans to close a "regulatory gap" by requiring non-bank mortgage lenders to report suspicious activity to the country's financial intelligence unit.
A U.S. Treasury Department advisory detailing red flags of reverse-mortgage scams takes another step in placing more responsibility for identifying such frauds within banks' anti-money laundering programs, say consultants.
Plans to make tax evasion a predicate crime of money laundering will likely be successful despite speculation that broader financial regulatory reform is foundering, say Capitol Hill staffers.
Non-bank mortgage lenders may soon have to comply with the Bank Secrecy Act as part of a broad effort to shield loan companies from money launderers, according to a U.S. regulator.
The current design of federally-mandated suspicious activity reports makes it difficult for banks to report important information tied to suspected mortgage fraud, say former law enforcement agents and consultants.
U.S. lawmakers voted Monday to pass a bill that would expand the definition of money laundering and strengthen anti-fraud laws, paving the way for the measure's passage.
The U.S. Treasury Department asked banks Monday to be wary of individuals and companies trying to take advantage of the government's loan modification program.
Less than two percent of the individuals and companies suspected by banks of mortgage fraud are identified by other financial institutions for separate crimes, according to the U.S. Treasury Department.
Plans to increase the number of federal financial crime investigators advanced Thursday as the Obama administration and lawmakers alike called for more resources at the U.S. Justice Department.
Bank reports of suspected mortgage fraud increased more than regulatory filings of any other financial crime in the twelve-month period ending June 30, the U.S. Treasury Department said Wednesday.
The U.S. Justice Department is investigating an undisclosed number of large corporations for fraud "not dissimilar" to Enron's accounting scandal in 2001, an FBI official said Wednesday.
A U.S. lawmaker called Thursday for the formation of a federal task charged with coordinating law enforcement investigations and training related to mortgage fraud.
The investigative arm of the Internal Revenue Service, charged with tackling intricate tax and money laundering cases, is shifting resources to handle a mushrooming mortgage fraud caseload, according to current and former special age
The key to catching mortgage fraud, says Joan Ferenzcy, is face time. Far too often, says Ferenzcy, head of Freddie Mac's fraud investigation unit, compliance officers and investigators fail to be proactive in the investigation process and instead passively make written requests for information.
Financial institutions filed 46,717 suspicious activity reports about potential mortgage fraud in fiscal year 2007, a 31 percent increase in the reports from the previous year, the FBI said Tuesday.
Suspected cases of mortgage loan fraud reported by financial institutions jumped 42 percent in 2007, marking the fourth consecutive year of double digit increases, the U.S. Treasury Department said.
Mortgage fraud cases skyrocketed during the real estate boom of the past decade, and the problem is likely to get worse this year, fraud experts say.