The US Federal Bureau of Investigation (FBI) says more arrests are on the cards as part of its continuing investigation into mortgage fraud.
Over 400 mortgage brokers and real estate professionals have already been taken into custody as part of the Bureau's investigation, a number one senior official described as "a good start".
Now the agency plans to further investigate corporate and mortgage related fraud in the coming months.
Lisa Osofsky ex-Deputy General Counsel for the FBI, believes the arrests are a positive development for borrowers and the industry.
“The US focus on forfeiture and asset seizure is admirable,” she says.
“Crimes like this damage the whole financial services industry and mean mortgages are more expensive for everyone. It is also important to trace the assets of criminals and reimburse victims; this requires international cooperation, as hiding assts all over world is possible these days and makes recovery difficult”.
The FBI says it is looking at the whole mortgage process - from making loans to an individual, to packaging and selling them to investors on Wall Street.
Selling 'packaged' debt, which consists of bundles of prime loans and sub-prime lending, has been partly blamed for the onset of the credit crunch and the multi-billion dollar writedowns made by banks across the world.
The UK’s financial regulator, the FSA, has also taken measures to identify mortgage fraudsters, including passing the details of offences to police forces for criminal prosecution.
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