Financial institutions are slowly making their way through problematic mortgages issued during the housing boom, causing a 31 percent jump in the U.S.’ number of mortgage loan fraud or suspicious activity reports in the first quarter of 2011 compared with the same period in 2010. The number of reports rose to 25,485 from 19,420 last year, according to recent figures released by government agency, the Financial Crimes Enforcement Network.

FinCEN attributed the increase in reports to additional reviews carried out by large mortgage lenders after receiving demands to repurchase poorly performing loans. Eighty-six percent of reports in the first quarter were related to activities that occurred more than two years prior. – Katherine Clarke [more]

New York City was first in the nation for mortgage fraud last year, according to a report by LexisNexis Mortgage Asset Research Institute, released today (see the full report after the jump). The metro area accounted for 12 percent of all suspicious activity reports filed with the Financial Crimes Enforcement Network in 2009, squarely defeating second-ranked Los Angeles, whose suspicious activity reports accounted for 8 percent of the nation’s total. On the whole, New York state has seen a sharp increase in mortgage fraud over the past few years. This year, the state — ranked 18th in 2007 — took second place, behind Florida. [more]