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Tag Archives: FinCEN

New Regulations for Fannie Mae and Freddie Mac

Per new regulations finalized last week, the GSEs will be required to file suspicious activity reports (SARs) directly with the Financial Crimes Enforcement Network (FinCEN) rather than through their own regulator. Developed in coordination with the Federal Housing Finance Agency (FHFA), FinCEN’s final rule is intended to provide law enforcement and regulators with a more complete picture of mortgage fraud.

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Foreclosure Rescue Fraud Up Despite Decrease in Fraud Reports

The number of filings related to suspicious activity for mortgage loan fraud fell year-over-year, while mortgage fraud related to foreclosure rescue scams spiked, according to a recent report from the Financial Crimes Enforcement Network (FinCEN). Last year, mortgage loan fraud (MLF) suspicious activity report (SAR) filings decreased to 69,277, down 25 percent from 92,561. However, the number of MLF SARs related to foreclosure rescue scams increased to 4,427, up 58 percent from 2,799 in 2011.

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Foreclosure-Prevention Scams Rise, Overall Mortgage Fraud Declines

The Financial Crimes Enforcement Network (FinCEN) reported a 25 percent decline in mortgage loan fraud suspicious activity reports (SARs) last year. However, the organization has seen ""dramatic growth"" in the number of SARs involving foreclosure rescue scams, according to Jennifer Shasky Calvery, director of FinCEN. Overall, financial institutions reported 69,000 suspicious activities to FinCEN in 2012, down from 92,000 in 2011. While this category experienced improvement in 2012, foreclosure rescue scams appear to be on the rise. About 2,800 SARs in 2011 involved foreclosure rescue scams. In 2012, the number ticked up to 4,400.

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Reports of Foreclosure Rescue Scams on the Rise: FinCEN

In the second quarter of this year, filers submitted 17,476 Mortgage Loan Fraud Suspicious Activity Reports (MLF SARs), marking a 41 percent yearly decrease, according to a report from Financial Crimes Enforcement Network (FinCEN). Even though reports of MLF activity made a steep drop and continue to fall year-over-year, reports of foreclosure rescue scams have been increasing. If foreclosures rescue SARs continue at the current pace into the remainder of 2012, the yearly total for foreclosure rescue reports will be significantly higher than 2011.

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Officials Recap Year-Long Effort of Distressed Homeowner Initiative

Federal officials jointly announced Tuesday the results of the Distressed Homeowner Initiative, which is the first nationwide effort focusing on fraud schemes that target struggling homeowners. Led by members of the Mortgage Fraud Working Group of the Financial Fraud Enforcement Task Force, the initiative spanned from October 1, 2011, to September 30, 2012. Federal officials revealed the efforts have led to 530 criminal defendants charged in 285 federal criminal indictments or informations filed throughout the U.S.

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Mortgage Loan Fraud Reports Decrease 31% Yearly: FinCEN

For the first quarter of 2012, the number of Mortgage Loan Fraud (MLF) Suspicious Activity Reports (SARs) submitted decreased 31 percent to 17,651 over a one-year period, according to a Financial Crimes Enforcement Network (FinCEN) report. In the first quarter of 2011, 25,485 MLF SARs were submitted. The high level of submissions a year ago was fueled by mortgage loan repurchase demands, which prompted reviews of dated mortgages, according to FinCEN.

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Independent Lenders Must Establish Anti-Money Laundering Programs

The Financial Crimes Enforcement Network (FinCEN) is expanding its reach. The agency, which in the past has required banks to establish anti-money laundering programs and notify FinCEN of suspected fraud through suspicious activity reports (SARs), will now require non-bank residential mortgage originators and lenders to do the same. FinCEN has noticed recently that many SARs it has received from banks reported suspicious activity on loans originated by independent lenders.

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Mortgage Fraud Suspicion Rises 88% Since Last Year

The amount of suspicious activity reports related to mortgage fraud filed in the second quarter of this year is 88 percent greater than the amount filed in the second quarter of 2010. Financial institutions sent in nearly 30,000 reports of suspected mortgage fraud over the April-to-June period this year, according to the Financial Crimes Enforcement Network. More than three-fourths involved suspicious activity that occurred before 2008, but officials say they're seeing evidence of ongoing fraud.

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Mortgage Fraud SARs Jump 31% as Investors Demand Loan Buybacks

A total of 25,485 suspicious activity reports (SARs) involving mortgage fraud were submitted to the Financial Crimes Enforcement Network in the first quarter, up 31 percent from a year earlier. The agency attributes the increase to more demands from investors for lenders to repurchase poorly performing mortgages, which have prompted additional loan reviews. Officials also found a number of incidents involving foreclosure rescue scams, false claims of identity theft, and property flopping.

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Mortgage Fraud Reports Down 41%, Says LexisNexis Research

Incidents of fraud reported by mortgage professionals during the 2010 calendar year were down 41 percent compared to the previous 12 months, according to data released Monday by the LexisNexis Mortgage Asset Research Institute. The company says misrepresentation on loan applications and verifications of deposit, along with appraisal and valuation issues, were the most blatant fraud problems last year. However, multiple industry reports indicate that identity, bankruptcy, and income-related frauds are on the rise.

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