Compliance

During the week of Dec. 5, three conspirators in a Valley mortgage-fraud ring say a Mesa minister with a worldwide following masterminded the scheme. A former loan officer, escrow agent and straw buyer who have pleaded guilty as part of a deal with federal authorities SAY THEY HELPED CLINT ROGERS launder millions of dollars through his ministry.

An Illinois man pleaded guilty in federal court for advertising and selling property in northwestern Alabama that he did not own or provide title for after receiving payments from prospective homebuyers to purchase these assets.

With a nod to Bob Dylan's prophetic lyrics, it seems the times are changing for the mortgage industry. Significant changes now taking place in the way mortgage loans are originated have created new challenges. Creative loan products have become a part of the past.

The trustee of the Meridian Investors Trust has filed a lawsuit on behalf of investors of the failed Meridian Mortgage funds to recoup over $150 million relating to a Ponzi scheme using their money.

JPMorgan Chase & Co.'s chief executive, Jamie Dimon, told investors at the beginning of 2011 that potential repurchases of private-label mortgage securities are "not that material" for his bank - an assertion that increasingly appears to be in doubt.

Nevada's attorney General Catherine Cortez Masto this week filed civil fraud charges against Lender Processing Services and two subsidiaries alleging the company engaged in a widespread fraud of forging foreclosure documents.

Alabama prosecutors opened a trial this week against a woman accused of helping her brother run a sophisticated fraud that helped obtain millions of dollars in fraudulent mortgages from First Educators Credit Union in Birmingham and other lenders to finance condominium rehabs at the Gulf Shores resorts.

The Securities and Exchange Commission on Friday sued Richard Syron, the former chief executive officer of Freddie Mac, and Daniel Mudd, ex-CEO of Fannie Mae, over disclosures they made about subprime assets the GSEs invested in.

FHFA Inspector General Steve Linick said he has opened "numerous" criminal and civil investigations of lenders, servicers, individuals and other firms that have victimized Fannie Mae and Freddie Mac.

Mortgage document preparation technology vendor DocuTech acquired competing doc prep technology Docs3D in a deal announced Tuesday.

Sometimes, mortgage origination fraud is easy to detect and other times it is frustratingly difficult. When a borrower deliberately lies about income, employment or identity, the fraud is clearly visible. But what about the case of an owner-occupied loan where the borrower never moves in, but still makes the payments as agreed?

Federal regulators took another step last week toward lessening banks' reliance on credit ratings by proposing three methods for assessing risk on firms' trading books.

The drop over 3Q11 of commercial and multifamily loans is a credit positive for CMBS, according to Standard & Poor's in a note released Friday.

The Consumer Financial Protection Bureau had so far limited its complaint process to just credit cards. But CFPB began taking complaints related to home mortgages as of Dec. 1.

Among the many hurdles any return of the private-label securitized market will likely have to overcome are conflict of interest measures in Section 619 of Dodd-Frank and the Volcker Rule, which as noted in a recent American Securitization Forum seminar, are hitting some key deadlines this month and next year.

An industry hedge fund that selectively trades distressed mortgage assets is testing the use of borrower rewards for timely payment, with the aim of driving better performance, refinancing or modifications.

Attorney General Eric Holder this week appointed Michael Bresnick as the new executive director of President Obama's financial fraud enforcement task force, which includes mortgage oversight.

Agency prepayment speeds came in line with expectations in the 30-year sector, where they were up 3% from the previous month, according to Credit Suisse's fixed income research report Wednesday.

The Attorneys General of California and Nevada are combining their investigative forces to combat misconduct and fraud within the mortgage industry against state homeowners.

Bank of America Corp. has agreed to pay $315 million to settle claims that its Merrill Lynch unit made false and misleading statements about the quality of subprime mortgage-backed securities it sold to investors.