MORTGAGE FRAUD RING DEFRAUDS MORE THAN 100 – IDENTITY THEFT THE VECTOR OF THE CRIME

Federal and state officials in Virginia are investigating an elaborate identity theft and mortgage fraud ring that defrauded over 100 people in a small town. Unwitting people were enticed to allow a real estate investment company to use their “good credit” to purchase properties at inflated prices. The company then falsely sought loans in their names and then defaulted on the loans. The default left the investors with fraudulent real estate ownership and inflated loans.

The investors were asked to provide personal information which would confirm their good credit and were then paid for providing the information. They were told that the information was not for securing loans in their names, but rather to assist in establishing “corporate” credit.

The company then engaged in a set of identity theft crime known as “impersonation crimes” where they used the personal information of the investor to seek loans in the name of the investor to purchase homes from their inventory.

One defrauded investor discovered the crime when the attempted to purchase a first time home and the local bank told them that they already owned four homes.

Mortgage fraud is rapidly growing in the US and is frequently facilitated by identity theft and impersonation crimes. The Federal Bureau of Investigation reports that mortgage fraud led to over $1 billion in 2005, up from $429 million in 2004.

Like most identity theft crimes, mortgage fraud is lucrative for the thieves and often presents little real risk of injury, capture, or long jail sentence.