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Riskiest Places for Mortgage Fraud: Interthinx

After remaining steady in the first quarter of the year, the ""Interthinx Mortgage Fraud Risk Index"":http://www.interthinx.com/pdf/12_Q2MFRR_073012_FNL.pdf rose again in the second quarter, climbing about 7 percent over the three-month period.

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Nevada and Arizona are the riskiest two states, followed by Florida, New Jersey, and Georgia, which made its way to the top five list for the first time since Interthinx began tracking mortgage fraud in 2009.

Georgia took the place of California, which has been on the top five list since the inception of the index. The state didn't move far down the list though; it now takes the No. 6 spot.

Several California metros remain high on the list for various categories of risk. For example, the top ten list for employment/income fraud risk is made up of nine California metros.

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The only other state to place on the list is Honolulu, Hawaii, which took the No. 9 spot.

A California metro also took the No. 1 spot in identity fraud risk. San Jose-Sunnyvale-Santa Clara placed first with an index score 20 percent higher than the No. 2 metro.

New York City is continuing to experience growing identity fraud risk. At the end of last year, New York City ranked 17th for identity fraud; the city is now ranked 6th.

Nationwide, about 91 metropolitan statistical areas are now categorized as ""very high risk,"" up from 63 metros in the first quarter.

Among these 91, the riskiest metro is Chattanooga, where mortgage fraud risk rose by more than 30 percent over the quarter. California and Florida metros round out the next nine riskiest metros, and Mobile, Alabama takes the No 10 spot.

The most common types of fraud varies somewhat by property type. Condominiums currently rank higher for identity fraud risk, employment/income fraud risk, and just slightly higher for occupancy fraud risk. However, single-family homes rank higher for property valuation fraud risk.

The greatest difference is seen in employment/income fraud risk, where condominiums rank 24.4 percent higher.

Interthinx predicts Arizona and Nevada will continue to experience high incidences of mortgage fraud.

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