DOJ May Start Fraud Task Force
Washington-The Department of Justice is moving closer to forming a national mortgage fraud task force to investigate and prosecute real estate and mortgage-related crimes, according to government officials familiar with the matter.
The effort, if it comes to fruition, would involve state, local and federal prosecutors working together "to find trends and bring cases," said one government official talking on background.
Presently, DOJ has a "working group" on mortgage fraud, which is an informal effort that focuses more on mortgage issues and trends, as opposed to specific cases.
Even though the mortgage crisis is now almost two years old, few executives who have actually managed mortgage banking firms have been indicted for financial crimes. Most of the cases brought have focused on low-level loan brokers, and others involved at the point-of-sale. Many of the cases have focused on home "flips" and equity-skimming schemes.
David Fleck, who recently stepped down as deputy district attorney in charge of real estate fraud for Los Angeles, said he has talked to DOJ about the task force, but noted that the agency has yet to make a final decision.
Once Lanny Breuer is confirmed by the Senate to head DOJ's criminal division, a final decision on the task force is anticipated, said one agency staffer.
Speaking at SourceMedia's Mortgage Servicing Conference in Dallas recently, Mr. Fleck noted that Los Angeles has 20 detectives working on real estate fraud related investigations but added, "We're just scratching the surface."
He noted, "There are all sorts of clever and creative ways to steal money. We have a duty as Americans to prevent fraud."