The U.S. Treasury's Financial Crimes Enforcement Network bureau this week released its latest quarterly figures, and a year-to-year increase in them suggests mortgage loan fraud-related suspicious activity is still on the rise. But they also offer some hope the numbers could recede if the high loan volumes from the peak of the housing boom are ever fully vetted.
The third quarter 2011 update finds financial institutions filed 19,934 SARs of this type compared to 16,567 during the same quarter of the previous year.
These filings and the continued rise in the MLF SAR numbers, stem largely from mortgage repurchase demands and other special filings generated by several financial institutions related to mortgage originated at the height of the housing boom generally said to occur between 2005 and 2007, according to the Treasury bureau.
The FinCEN report also found close to 62% of the mortgage loan fraud-related SARs involve suspicious activity that started four or more years ago. This suggests that the housing boom loans continue to be the main factor boosting the total and their influence could fade over time.
Mortgage loan fraud constituted 29% of the total SARS filed between October 2009 and September 2011, according to FinCEN.
Types of suspicious activity included some form of loan workout or debt elimination attempts, questionable refinance or loan modification attempts targeting distressed homeowners and Social Security number discrepancies submitted in both the original loan application and the workout request.
The top five counties in per capita rankings of MLF SARs in the third quarter of last year were Santa Clara County, Calif.; Honolulu County, Hawaii; Orange County, Calif.; San Bernardino County, Calif.; and Palm Beach County, Fla.
The top five states ranked per capita were Hawaii, California, Nevada, Florida and Delaware.
