Mortgage Fraud Blog is the premier website for news and information on mortgage fraud and real estate fraud throughout the United States.
Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of Smith Dollar, PC, is licensed to practice law in California and maintains offices in Santa Rosa, California. Email Ms. Dollar
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Initial Results of Illinois Crackdowns on Unlawful Mortgage Brokerage Practices
As the result of a series of aggressive, new inspections by state regulators into mortgage lending practices, Illinois Governor Rod R. Blagojevich announced on April 28, 2006 $190,750 in fines for 22 licensed residential mortgage offices and the suspension of one office in Oak Brook, Illinois for failing to comply with state regulations. Earlier this year, the Governor ordered the Illinois Department of Financial and Professional Regulation (IDFPR) to begin a series of unannounced inspections of licensed mortgage companies in response to reports of growing instances of mortgage fraud. This sweep is the first of planned quarterly reviews of the mortgage industry to help protect homebuyers from predatory mortgage lenders.
“Buying a home should be the culmination of the American dream, not the beginning of a nightmare of fraud,” said Gov. Blagojevich. ”We have worked hard to pass laws to protect families from fraud and abuse. We will not tolerate activities that could harm homeowners. Now, mortgage firms are on notice that we’ll be dropping-in unannounced to make sure their brokers are complying with the law.”
IDFPR’s investigation found that 19 mortgage firms employed 35 unregistered loan originators – individuals who process family mortgage applications. In the most egregious violation, First Star Financial Corporation, located at two locations - 361 South Frontage Road, Suite 131, Burr Ridge, and 1355 Remington Road, Suite T, Schaumburg - had 10 unregistered loan originators working in its offices, and was issued fines of $25,000 for each of the two offices employing unregistered loan originators. Residential mortgage companies employing unregistered loan originators are subject to a $2,500 fine for the first violation and $500 for each additional unregistered loan originator. Individual unregistered loan originators are subject to fines of $950 and a permanent notation on their file should they decide to seek certificates of registration in the future.
IDFPR also issued an emergency suspension against Liberty Mortgage Corporation1301 E. 22nd Street, Suite 815, Oak Brook, IL for refusing to allow its investigators access to its premises on several successive attempts. The suspension is in effect until the administrative review process is completed up to 180 days. In addition, 1st Liberty Banc, Inc. was fined $25,000 for each of the two days the company denied access to authorized state investigators.
Predatory fraudulent mortgage lenders are devastating communities across the state. As the Chicago Tribune reported in November 2005, a single block on South May Street in Chicago saw four homes shuttered within four years due to mortgage fraud, and the area has since become a haven for criminals. A study done by the paper showed that 16 of the 34 census tracts in Englewood and West Englewood were high-intensity fraud areas, with at least 10 frauds per 1,000 owner-occupied housing units.
Other practices under investigation include: multiple businesses operating from the same location; mortgage companies operating from a home without proper Department and zoning permission; business offices closed during office hours, which, according to regulation, must be clearly posted; and, companies operating from locations that are different than the address registered with the state.
These sweeps complement the regular examinations conducted by IDFPR as part of its regulatory responsibility to ensure that residential mortgage companies provide safe, effective services to the homebuyers and homeowners in Illinois.
“Illinois consumers have the right to know that when they do business with companies licensed by our state, they will receive the best possible service by ethical and appropriately trained professionals,” said Dean Martinez, Secretary, Financial and Professional Regulation. ”We will use all the tools available to us to discipline companies which violate of the laws and regulations designed to protect Illinois homebuyers.”
Throughout his administration, Gov. Blagojevich taken numerous actions to assist homebuyers and protect consumers with initiatives to: Reduced the number of high-risk home loans, Protect homebuyers in at-risk communities from predatory lenders, Regulate the payday loan industry, Give homebuyers easy access to accurate information about their properties, Protect homebuyers from discrimination and Help for first-time homebuyers.
Failed Mortgage Firm Trustee Allowed $50,000 in Fees Union Leader
U.S. Bankruptcy Court Judge J. Michael Deasy will approve $50,000 in legal fees for the trustee of failed mortgage brokerage businesses Financial Resources Mortgage Inc. and CL&M Inc.
Bend Oregon Event to Help Homeowners Prevent Foreclosures Oregon.Gov
As part of an ongoing effort to help homeowners avoid foreclosure, state agencies are organizing a foreclosure-prevention event in Bend on Saturday, March 27, 2010.
Shelbyville Man Gets 2-Year Sentence For Loan Fraud Chattanoogan.Com
Prosecutor Gary Humble said the lost was approximately $2.3 million in the mortgage fraud involving hundreds of homes in the Shelbyville area.
Lend America, VP Ashley Banned from FHA Housing Wire
Michael Ashley, the embattled former vice president of Federal Housing Administration (FHA)-backed mortgage originator Lend America, and the company he worked for, were permanently banned from doing business in the industry last week.
Countrywide Tries to Pin Blame on Insurer Court House News
Countrywide Home Loans demands $111 million from Triad Guaranty Insurance, claiming Triad is trying to blame mortgage lenders for the insurer's role in the housing bubble and collapse.
Investors Say They Were Swindled in Property Scheme Fox 13 Now
Utah Division of Consumer Protection is joining forces with a few investors who claim they have been cheated by an agency called "Utah Mini Ranches.
Greenfield Man Accused of Housing Scam The Republic
A former real estate agent conned at least eight people by renting them properties actually owned by a federal agency and then running off with their deposits, prosecutors said.
Appraisal Institute Opposes Obama Administration's Plan for Homeowner 'Short Sales' PR News Wire
Citing concerns about increased mortgage fraud, four organizations representing more than 35,000 real estate appraisers today voiced their opposition to changes to an Obama administration program that will encourage "short sales" of homes.
Ownership Rights to Get Another Look TBO.Com
State lawmakers may beef up protections of property owners' rights by rewriting a law this spring that is at the center of a case of alleged fraud in Pasco County.
Thursday, February 18, 2010 F. Jeffrey Miller Trial Continued Testimony
As reported by Anne Mitchell, who viewed the trial:
Angela Parenza worked for Jeff Miller as the office manager for 7 or 8 years beginning in 1998. Parenza was indicted along with Miller and pled guilty to conspiracy to commit bank fraud and money laundering. Parenza testified that Miller or his contractors allegedly preferred to build all the...
Wednesday, February 10, 2010 F. Jeffrey Miller Trial Coverage Continued - Witness Testimony
Steve Middleton Testimony - Coverage Provided by Anne Mitchell
The Government continued in its cross examination of Steve Middleton. He was shown several HUD-1 statements involving sales of homes located in Overland Park, KS, and Olathe, KS. The HUD statements each allegedly showed line items of payments to (James) Moser & Associates, LLC's...
Monday, February 01, 2010 F. Jeffrey Miller Trial Coverage - Continued Witness Examination
According to Anne Mitchell, who is present in court for the trial:
Next Witness: Kelly Sanford
Kelly Sanford of the Federal Reserve was a short witness for the Government. Sanford manages electronic payments between banks and member financial institutions. He was shown copies of wire transfers and asked whether they coincided with the counts in...
Wednesday, January 27, 2010 F. Jeffrey Miller Trial - Prosecution Witnesses Continued
According to Anne Mitchell, who is viewing the trial:
January 13, 2010
Witness: Rick Hayes
Rick Hayes testified that on the day that he closed on his Miller Enterprise home, he received a phone call from the Kansas Banking Commission informing him that his loan was fraudulent. After the Hayes responded to a classified ad, they met with John...
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The information and notices contained on Mortgage Fraud Blog are intended to summarize recent developments in mortgage fraud cases and mortgage banking matters nationwide. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about mortgage banking, mortgage fraud matters or who believe they require legal counsel should seek the advice of an attorney. The creators, editors and sponsors of Mortgage Fraud Blog do not intend to create a confidential relationship or an attorney-client relationship by communication via or arising from this site.
Rachel Dollar, the editor of Mortgage Fraud Blog, is an attorney and Certified Mortgage Banker who handles litigation for lending institutions and secondary market investors. She is an author and a nationally recognized speaker on the topic of mortgage fraud. Ms. Dollar is a shareholder with the law firm of 
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