Allegations of white-collar crimes can result in serious ramifications. Financial institution fraud targets credit unions, retail banks and other federally-insured institutions. According to the FBI, mortgage fraud is financial institution fraud. When it comes to individuals committing financial institution fraud, the FBI prioritizes those who cause a significant impact on the community or cause high losses for banks and lenders.
If you face allegations of mortgage fraud, there are two areas to remain aware of.
Fraud for housing
The housing market is competitive and challenging to navigate. While the FBI does not prioritize fraud for housing, it can still result in serious charges. Fraud for housing occurs if a borrower wants to acquire or maintain ownership of a home and acts fraudulently to do so. For example, if you misrepresent your income or asset information on a loan application, the institution can claim mortgage fraud. Likewise, it becomes fraud if a person convinces an appraiser to manipulate an appraisal for his or her benefit.
Fraud for profit
Fraud for profit is the more serious of the two areas of mortgage fraud. Those who commit mortgage fraud tend to have inside information on the industry. Professionals who may commit fraud include attorneys, mortgage brokers, appraisers, loan originators and bank officers. Those who commit fraud for profit do not want to maintain ownership of a house. Instead, they may intend to take cash from lenders or homeowners.
Mortgage fraud may include illegal property flipping, foreclosure rescue and loan modification schemes. The FBI has a Financial Crimes Task Force to address large-scale financial fraud.