Mortgage Fraud on Record Pace

In fiscal year 2007, which ended last September, there were 46,000 SARs on mortgage fraud. There were also 260 convictions resulting from SARs. We are six months into FY 2008 and there have been nearly 30,000 SARs so far.

The surge is in team-type activity where mortgage insiders, such as appraisers, real estate agents, loan officers, and lawyers conspire to commit "fraud for profit" schemes.

It is estimated that mortgage lenders will lose $2.5 billion due to mortgage fraud this year, according to the TowerGroup.