In an acknowledged bid for publicity to deter future crimes, the FBI today announced it had charged 406 people involved in 144 unrelated mortgage fraud cases since March 1 as part of an effort dubbed "Operation Malicious Mortgage."

The FBI said most of the cases involved lending fraud, foreclosure rescue scams or mortgage-related bankruptcy schemes, causing about $1 billion in losses. Five dozen people were arrested in 15 judicial districts on Wednesday alone.

Banks and other financial institutions filed 52,868 suspicious activity reports involving suspected mortgage fraud in 2007, an increase of 42 percent over the year before, the Financial Crimes Enforcement Network reported in April (see story).

The industry-financed Mortgage Asset Research Institute (MARI) says it may be three to five years before many instances of fraud and misrepresentation in loans made in 2007 are discovered. Many adjustable-rate mortgage (ARM) loans will be refinanced, "potentially blocking discovery of some of these issues," MARI concluded (see story).

FBI Director Robert Mueller said today that the bureau obtained 321 mortgage fraud indictments and 260 convictions in 2007. The bureau has increased the number of agents devoted to mortgage fraud investigations from 120 in 2007 to 180, he said.

Asked whether the 1,400 mortgage fraud cases the FBI currently has open represents only a fraction of the problem, Mueller said it was a "substantial number of investigations," and, from his perspective, "not a small number."

But he acknowledged that the bureau has "always had to prioritize" resources, "particularly in the wake of (the) Sept. 11" attacks, after which the FBI diverted many agents from white-collar crime investigations into counter-terrorism efforts.

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription
×