Miami real estate fraud charges resulting in prison time for white-collar defendants

Federal mortgage fraud convictions reached a record high last year, despite fewer cases being investigated, the Internal Revenue Service reported.

As we reported last week on our Miami Criminal Attorney Blog, Florida — and particularly South Florida, including Miami, Fort Lauderdale and Fort Myers — led the nation in mortgage fraud cases last year. With investigators placing increased emphasis on prosecuting mortgage fraud claims, seeking the advice of a qualified Miami criminal defense attorney is critical to protecting your rights.

Gone are the days when white-collar crime in Miami and elsewhere was viewed with tolerance. About 4 of 5 defendants convicted of real estate fraud are sentenced to prison; the average term is three years behind bars.

Why there were more criminal convictions, despite fewer cases, is a complex question. Authorities may be pushing stronger cases, juries may be better educated in the wake of several years of news regarding mortgage fraud (or just more weary and more likely to convict), and the conviction rate could be influenced by several years of backlogged cases reaching conclusion.

The most common types of Real Estate Fraud schemes included:

Property Flipping: Claims over property flipping are increasingly common, despite the fact that it is not illegal to buy low and sell high — it is the very definition of good investing! However, allegations of fraud can arise when false statements were made to lenders.

Two Sets of Settlement Statements: One set is provided to the seller, accurately reflecting the selling price. Another set is given to a lender, showing an inflated price. After the loan is made, the excess proceeds are split among the conspirators.

Fraudulent Qualifications: Real estate agents who fabricate records to assist buyers in qualifying for a property.

In many faces, federal investigations result in money laundering charges in Miami and elsewhere as the government seeks to root out income hidden from the tax man. And, of course, the ever-popular tax evasion charges are often used when proof of other illegal activity is too hard to obtain.

Real Estate Fraud Statistics 2009 2008 2007

Investigations 336 349 337
Convictions 184 136 130
Average Prison Term 35 38 35