Regulatory Alerts2009-04-06
Added
Mortgage Loan Fraud: An Update of Trends based Upon an Analysis of Suspicious Activity Reports
This report updates trends in Suspicious Activity Reports (SARs) citing suspected mortgage loan fraud filed between April 2006 and March 2007, noting a 44% increase in filings to 37,313 in calendar year 2006. It identifies vulnerabilities in specified mortgage products, including a 53% increase in suspected fraud in cash-out refinance loans and a 69% increase in stated income or low/no document loans. The analysis highlights that mortgage brokers initiated the loans reported on 58% of sampled SARs and details common fraudulent activities such as misrepresentation of income, forged documents, and appraisal fraud. Additionally, the document reports a 95.62% increase in suspected identity theft associated with mortgage loan fraud during the reviewed period.