Federal and state governments have made prosecuting mortgage fraud a significant priority. In part, the number of investigations has intensified due to the impact the housing market has on the nation's economy and its financial institutions, but also because federally insured financial institutions have increased their reports of fraud to the FBI.
What is Mortgage and Bank Fraud?
Mortgage fraud schemes generally involve a material misstatement, misrepresentation or omission relating to a property that is presented to and relied upon by the lender or insurer in making a decision whether to fund, purchase or insure the loan. In 80 percent of federal cases, the "scheme" involves an agreement between an industry insider or insiders – an appraiser, underwriter, mortgage broker, or banker – to siphon money or equity out of a transaction. A critical fact in mortgage fraud cases is whether the fraudulent statement is "material"; whether the lender or insurer knew about the falsehood; and whether the lender or insurer conducted a diligent review before executing its decision.
Texas Bank Fraud Defense Attorneys
Mortgage and bank fraud cases are often complex since they may involve prior civil litigation and large amounts of "paper". Thus, these cases require significant document review so that the attorney understands the facts and can present a viable defense. These cases frequently involve large amounts of alleged "loss" that, at the federal level, could expose a defendant to lengthy sentences. Loss calculations in mortgage and bank fraud cases require knowledgeable attorneys that understand how to lower or offset "loss" and thus limit a defendant's prospective sentence.
As stated above, mortgage frauds may be prosecuted by federal or state authorities. Often, the prosecution alleges conspiracy, but the crime may also involve bank fraud, false statements to federally backed institutions, mail and wire fraud. Significantly, frauds that affect a federally insured financial institution have a ten-year statute of limitation.
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