Friday, April 01, 2005

FBI Sees Increase in Mortgage Fraud

Consider's "Safe Harbor" Form for Appraisers

According to the Federal Bureau of Investigation, problems with fraud related to home mortgages has grown more prevalent in recent years as low interest rates have spurred a surge in home sales.

In October 2004 testimony before the House Financial Services Housing and Community Opportunity subcommittee, Chris Swecker, the assistant director of the FBI's criminal investigation division, said the FBI is now working more closely with the mortgage industry to develop a better system for reporting fraud.

For companies or individuals not required to report suspicious activity under current law, the FBI and Mortgage Bankers Association are considering developing a Suspicious Mortgage Activity Report or "SMARt form" that would provide a "safe harbor" for lenders, appraisers, brokers, and others involved in the mortgage process, similar to other safe harbor provisions given to those in other financial institutions.

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