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LA Leads in Mortgage Shadiness

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While noting that's it not a necessarily thorough report, the Los Angeles Times Peter Hong reports that the FBI's annual mortgage fraud review says Los Angeles is #1 in the nation when it comes to mortgage fraud. "The Los Angeles field office received 9,971 "suspicious activity reports" in 2008; second-place Miami had 5,155. The report says fraud schemes include builders offering secret incentives to home buyers, such as falsely inflating a purchase price to make it appear as if a buyer has made a down payment when none was made. If the home forecloses, there is no home equity for the lender to recover." Nationwide, mortgage fraud jumped 36 percent in 2008, according to Reuters. Via the FBI's report, You can read more about all the different scenarios that are considered mortgage fraud, according to the agency. There are some excellent names to these categories of con, such as "Serial Property Flipping," "Builder-Bailout - Pump and Pay," and the self-explanatory, "Foreclosure Rescue - Arson." [LA Times; nationwide figure via the FBI]