Over the past 10 years, instances of mortgage and real estate fraud have increased dramatically. In response, both North Carolina and federal law enforcement officials have increased their investigations into "suspicious activities." Unfortunately, many of these investigations have resulted in the filing of serious criminal charges against otherwise innocent people.
The consequences of a conviction for financial fraud are extremely serious. If you have discovered that you are under investigation for mortgage fraud or have already been formally charged, securing the guidance of an experienced and knowledgeable criminal defense lawyer is essential to protecting your rights and your future.
What Is Mortgage Fraud?
Mortgage fraud is a broad term used to describe intentional misrepresentation or omission of information on a mortgage loan application or other documentation at or during any part of the application or lending process. It can occur at any level of a real estate transaction, and can involve parties ranging from the developer or lending institution to the buyer, seller, real estate agent or mortgage broker.
Following an intricate and often lengthy investigation, law enforcement officials will file either felony or misdemeanor charges. A majority of mortgage fraud cases are prosecuted as felonies in federal and state courts. More and more of these cases are being charged in federal court. Penalties for conviction may include up to 30 years of imprisonment.
Under Investigation? You Need to Protect Yourself
Law enforcement is often alerted to potential mortgage fraud through suspicious activity reports (SARs) filed by financial institutions and/or various government offices. Red flags that may trigger an investigation include:
- Foreclosure of the property
- Filing for bankruptcy
- Fraudulent appraisals
- False reporting of income, financial fraud
- Unusually high or suspicious commissions
- Higher than customary fees
- Legal advice provided by non-attorneys, misrepresentation
- Purchase loans masked as refinance
- Multiple holding companies used to inflate property values