According to a study by the LexisNexis® Mortgage Asset Research Institute, mortgage fraud and misrepresentation increased 7% from 2008 to 2009.
Reasons the LexisNexis® Mortgage Asset Research Institute cited for the increase include "new opportunities to take advantage of consumers, maintenance of lifestyles obtained during the boom period, consumers who are desperate for the American dream of home ownership, and the need for new, creative methods of moving illicit funds." It also states that the fraud is being facilitated by technology which provides "fraudsters with the ability to access information, conduct criminal activities and remain anonymous via the internet, and manipulate processes that rely on the need for expediency."
Appraisers had a role in fraud in that "[t]he most prevalent types of appraisal fraud and misrepresentation for loans originated in 2009 involve incorrect comparables, omitted information, and value inflation. Thirty-six percent of loans with reported appraisal fraud and/or misrepresentation have misused comparables. Thirty-three percent involve a material omission of relevant information that would have affected the value. Value inflation . . . is also a large portion of reported appraisal fraud and misrepresentation."
Sometimes mortgage fraud may occur in false advertising and email scams. Consumers receiving emails should know they can file suit for unwanted emails, even when it is from banks or companies they have done business with. California's anti-spam law prohibits the sending of an uninvited commercial e-mail from California or to a state resident that misrepresents either the source or the subject of the message.
California's law allows private suits and recovery at $1000 per violation even when someone does not actually lose money or accept an offer from the unwanted email. For example, Daniel Balsam filed suit against Trancos Inc., a Redwood City, California advertising company, after he received a number of unwanted e-mails in 2007.
In Balsam's case, Balsam complained the "from" line in the eight e-mail messages he received from Trancos did not name Trancos as the sender. None of the e-mails provided a toll-free number to opt out and seven of them did not provide the ability "unsubscribe" by e-mail.
Rinne Legal provides counseling to individuals, families and small businesses in financial difficulties. Call for a no charge initial consultation.
