First came the sub-prime mortgage collapse, then a flurry of foreclosures – and now a wave of mortgage scam artists. The President’s Financial Fraud Enforcement Task Force was in L.A. Thursday to talk about how to flatten that wave.
Task force members say there have been 300,000 foreclosures in Southern California this year. So it’s no surprise that Southland law enforcement is also looking into hundreds of mortgage fraud cases with losses above a million dollars. FBI agent Sharon Lawrence said she often hears about scammers running “foreclosure rescue” schemes that target homeowners trying to hold off foreclosure.
“The bad guy could approach a defaulting homeowner and offer to file a lawsuit on behalf of the homeowner and basically say, 'If you pay me $500 or $1,500' or whatever the fee may be for the service they promise – some act or service which is later not performed.”
Lawrence says popular mortgage cons include short-sale scams, loan origination fraud, bogus bankruptcy filings and property flipping schemes. And because scams are becoming more complex, she says federal and state officials are working together to step up their investigation efforts.