The Internal Revenue Service says it initiated nearly 200 real estate fraud investigations in fiscal year 2004 and secured 89 convictions for tax fraud and money laundering."In recent years, the booming real estate has helped increase mortgage fraud and other phony real estate schemes," the IRS said. "The perpetrators of these schemes range from mortgage brokers looking to make a fast buck to drug dealers laundering their ill-gotten gains." The most common schemes involve property-flipping, straw buyers, and submission of false settlement statements to lenders. IRS criminal investigations involving mortgage fraud have doubled since fiscal year 2001. "FY 2004 statistics reflect a three-year high of the number of cases recommended for prosecution, as well as indicted, convicted, and incarcerated," the IRS said.

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