FBI to crack down on mortgage fraud

The FBI is preparing a nationwide crackdown on mortgage fraud, the latest in a series of efforts to curb lending practices that contributed to the housing meltdown, the Financial Times reported, based on information from inside sources. The FBI is preparing to arrest hundreds of people across the U.S. as early as next week for offenses including encouraging borrowers to falsify income on mortgage applications, misleading homeowners about foreclosure rescue programs and inflating home appraisals. Since October 2008, the FBI has opened 23 local mortgage fraud task forces around the country. As of June 2009, suspicious mortgage-related activity for the year was on track to exceed 70,000 cases, a 10 percent increase over 2008 levels, according to preliminary FBI estimates. Mortgage fraud-related losses totaled $1.4 billion in 2008, an 83.4 percent rise over the previous year. [Financial Times]