The FBI arrested two Californians last week for allegedly victimizing dozens of Los Angeles County homeowners by falsely promising they could stop foreclosures, federal authorities said, according to media reports.
Martha Rodriguez, 33, of Downey, Calif., and Edward Seung Ok, 39, of Torrance, Calif., defrauded homeowners out of at least $8 million, according to an indictment by a Los Angeles federal grand jury, reports said.
The pair were arrested Wednesday by the FBI for allegedly promising that co-signers would help homeowners refinance their mortgages until they could clean up their credit and get new loans, according to the Los Angeles Times.
Instead, the indictment alleged, Rodriguez and Seung used falsified mortgage applications to defraud lenders and the homeowners, causing losses of at least $8 million, the Times reported.
Attorneys for Rodriguez and Seung couldn’t be reached by the Times for comment.
Mortgage fraud is on the upswing, with the number of suspicious activity reports to the Federal Bureau of Investigation in 2004 almost triple those in 2003, according to a report the FBI released in May.
According to the Federal Financial Institutions Council, up to 10 percent of all mortgage loan applications in the $3 trillion annual U.S. residential real estate market involve some form of material misrepresentation. States are taking action to counter this trend, with Georgia’s new Residential Mortgage Fraud Act having been signed into law May 5 by Georgia Gov. Sonny Perdue.
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