Criminal Justice
Mortgage Fraud Is Rarely Prosecuted
Posted Apr 15, 2009 11:51 AM CST
By Martha Neil
Although bank robbers steal less, they're a lot more likely to be prosecuted criminally than those who commit mortgage fraud and deed thefts.
Lacking staff and resources to pursue such complex real estate cases, prosecutors in New York have tended to treat them as civil matters even as they proliferated in recent years and wreaked devastating consequences on many homeowners and the economy, according to the New York Times.
"Bank robbers average less than $2,000 and face a 75 percent chance of being caught; a mortgage fraud ring walks away with hundreds of thousands of dollars per house, prosecutors say, and runs little risk of arrest," the newspaper writes in a detailed article about the problem.
News coverage suggests that the same issues routinely discourage prosecution of those who steal homes and mortgage funding in other jurisdictions, too. While a few high-profile cases grab headlines and a number of prosecutors say they are increasing the number of criminal investigations, it appears that a massive amount of real estate-related fraud has swamped government resources.
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Comments
B. McLeod
Apr 15, 2009 12:11 PM CST
Some years back, Woody Guthrie noted, “Some’ll rob you with a six-gun, some with a fountain pen.” I believe he was thinking about bankers at the time, and about a postulate (somewhat popular then) that it should be OK to rob banks, because the banks were robbing everybody else. (Fast forward 70 years, as we see a world, and bankers, reminiscent of the 1930s).
The notion of an almost- acceptable category of genteel, “white-collar crime,” committed by the idle upper classes or the lumpen bourgeoisie in business suits, has deep roots in our culture. Such conduct has been treated, and continues to be treated, as being almost not a crime at all, and so, unsurprisingly, it most often draws no meaningful punishment. it is almost as though there is some persistent, background social policy to encourage it.
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brad
Apr 15, 2009 12:36 PM CST
See mortgage fraud everyday. Just had a guy rob $365k today and I doubt nothing will be done civil or criminal
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Michael
Apr 16, 2009 9:41 AM CST
Mortgage fraud is rampant. Of the four counties we’ve studied so far a majority of foreclosures are to mortgage servicing companies that have no documented relationship to the homeowner they’re suing: no assignment, no deed, no note in their name. Even for those who have notes there is evidence of fraud: signatures that are clearly forgeries, missing pages, etc… It’s hard to buy the argument that these cases are difficult to prosecute: there’s a well established audit trail, and most paperwork is filed with government agencies. A lot of it is available online via clerk websites. The more logical conclusion is that law enforcement—maybe under political pressure, or possibly out of incompetence—just doesn’t care.
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