Criminal Prosecution For Mortgage Fraud During Real Estate Bubble
Many of my clients are facing the prospect of lawsuits for personal liability on account of default on mortgages. Some of these clients have invested in many investment properties which are now upside down and unsustainable. During the real estate bubble many people inflated their income and assets on mortgage applications. My clients often ask me if the mortgage company will refer their case to the government for criminal prosecution because the clients had lied to their mortgage company in order to get financing. This week I received a call from a criminal defense attorney who was referring a client to me for asset protection advice. During our conversation I asked him if the mortgage companies or the government were prosecuting mortgage fraud related to the real estate bubble.
The criminal attorney said that state and federal governments are actively pursuing mortgage fraud cases against large builders and mortgage companies. He has seen no criminal prosecution related to owner occupied properties. The attorney said that so many people lied to get financing for their own homes that the government has not way to fairly decide who to investigate and does not have resources to handle so many cases. The FBI is prosecuting some investors who fraudulent obtained mortgages on numerous investment properties where the mortgage fraud is egregious. The attorney has been told by prosecutors that the FBI will not even consider prosecuting mortgages less than $500,000 and will rarely investigate mortgages under $1
posted by Jonathan Alper, asset protection and bankruptcy attorney, Orlando, Florida
