Suspected Mortgage Fraud in Miami, Florida, Highest Nationwide

A new recently released report by the FBI, called the 2010 Mortgage Fraud Report, revealed that Florida, and specifically the Miami and Tampa areas, are the number one places in the country for mortgage fraud.

The recent Federal Bureau of Investigation report will no doubt cause this agency and local law enforcement to take an even closer look at any mortgage transaction when a person loses money. There have been many instances of investment transactions that went south after the economy crashed and led state or federal prosecutors to file baseless charges of mortgage fraud in Miami.

Because there has been so much media and law enforcement attention and the buzzword “mortgage fraud” is so heavily used right now, these prosecutions seem like they take place every day. And that’s too bad because, as Miami Criminal Defense Attorneys have noted, many people who face charges or investigations have done nothing wrong. In fact, they may have been left holding the bag when the real estate market collapsed. And as many experts have seen, Florida was one of the heaviest hit for foreclosures and upside down mortgages in the country.

According to the FBI report, the agency used data from law enforcement and industry sources to compare and map areas most affected by mortgage fraud in 2010. After compiling the data, the agency determined that Florida leads the nation in mortgage fraud activity, followed by California, Arizona and Nevada.

The agency’s figures found that Miami has 92 pending mortgage fraud cases, seventh highest in the nation. Tampa’s FBI office has 177 cases. Las Vegas leads the nation in pending mortgage fraud cases with 292.

The majority of FBI-investigated cases — about 55 percent — result from activity occurring between 2009 and 2010, while about 36 percent of the cases regard alleged fraud in 2007 and 2008. The remaining 9 percent of cases are from 2001 to 2006 activity. The agency estimates that in 2010, there were $3.2 million in losses from suspicious activity reports, up from $2.8 million in 2009 and $1.5 million in 2008.

Certainly, many people have lost money in the real estate crash during the Great Recession. Few Americans, as well as those abroad, were completely sheltered from the violent downswing in the economy. But while there were losses, that doesn’t mean every real estate transaction or investment opportunity that went south was a matter of fraud.

Charges of mortgage fraud in Miami can be prosecuted either in state or federal court. And hiring an attorney early in the process is important.

Being charged in state court can bring lesser penalties, whereas the federal court system has more structured penalties that are tougher to get reduced. Federal criminal penalties are calculated by guidelines that judges must follow, whereas circuit judges at the state level have more discretion in their sentences. That can make a big difference for a client.