Florida has replaced Georgia as the hottest spot in the country for mortgage fraud, according to the latest figures from the Mortgage Asset Research Institute.Utah moved up to second place, while the Peach State slipped to third, MARI said in a statistical report released at the Mortgage Bankers Association's First Annual National Fraud Issues Conference. Officials at the meeting Monday attributed the decline in the MARI Fraud Index for Georgia to the state's year-old law which codifies mortgage fraud as a crime. To date, Georgia is the only state to specifically make loan fraud a criminal offense. But at least five others -- New Jersey, Utah, Colorado, Oklahoma and California -- are considering similar legislation. "It's getting people's attention," Georgia Attorney General Thurbert Baker said at the conference. "It shows the impact that state laws can have," agreed California attorney Arthur Prieston, a specialist in fraud. According to the MARI index, the fraud rate in Georgia went from three times the national average to less than twice the national average, "a far cry from 2003, when it far outstripped every other state." On a national level, however, MARI found that problems in loan application misrepresentation remain high. Colorado and Illinois are seeing more instances of fraud, while South Carolina has shown a marked improvement, according to the report.

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