60,000 Reports of Fraud Likely in 2008

This year, reports of mortgage fraud are on track to reach 60,000, according to the Federal Bureau of Investigation — which had more than 1,000 open cases last year.

During the fiscal first quarter of 2008, which began on Oct. 1, 2007, the agency received 15,000 Suspicious Activity Reports, FBI spokesman William Carter told MortgageDaily.com in an e-mail statement.

“If the numbers continue at the rate,” he said, “they have the potential to reach 60,000.”

That would be well above the 48,000 SARs in 2007 and about 20 times the level in 2003, according to FBI figures.

The bureau, which itself only investigates cases that are at least $500,000, said there were 1,210 cases opened in 2007, rising from 818 cases in 2006. About 60 percent of the cases have estimated losses in excess of $1 million.

In 2003, there were just 436 cases, data from the agency indicate.

Carter noted, however, 34 task forces or working groups consisting of members of various federal, state and local agencies addressing mortgage fraud are currently investigating smaller cases.

He said an analysis of their cases and SARs data, as well as data from MARI and the Federal Housing Administration, indicated significant mortgage fraud problems exists in Arizona, California, Colorado, Florida, Georgia, Illinois, Indiana, Louisiana, Michigan, Missouri, New York, North Carolina, Ohio, South Carolina, Texas and Utah.

He cited one case where the owners of Parish Marketing and Development Corp., a Minnesota home builder, pleaded guilty in November to a scheme involving 200 homes and around $100 million in loan proceeds. The owners, Michael Alan Parish, 62, and his wife, Ardith Ann Parish, 61, acknowledged obtaining more than $25 million from the scheme.

The two were aided by employee Christopher David Troup, appraiser Donald Todd Yeager and U.S. Bank officer Ramiz Yousef Saadeh — all who have reportedly also pleaded guilty.