Jan 27 2010 Emmanuel Olaoye
As the number of cases of mortgage fraud reported by financial institutions start to slow down, institutions are increasingly being targeted in other frauds, such as fictitious trades. The findings of a study by the Financial Crimes Enforcement Network appear to show that fraudsters are seeking other ways to defraud institutions as lending standards tighten across the country. The study, which looked at suspicious activity report filings for the first six months of 2009, found an increase of 150 percent in filings on fictitious trades, compared to the same period in 2008. Although mortgage fraud filings rose by just one percent, mail and wire fraud filings rose by 52 percent and 56 percent respectively. Total filings in the securities and futures industries also increased by 29 percent. FinCEN said that mail fraud, wire fraud, and fictitious trades fueled the rise.
As Complinet has previously reported, President Obama issued an executive order in November for the creation of a multi-agency fraud task force to combat securities, mortgage, and corporate fraud. The task force aims to improve coordination between federal and state regulators to better analyze suspicious activity reports.
James Freis, director at FinCEN, said: "FinCEN remains focused on its proactive efforts to assist state, local and federal investigators in efforts to use SARs to crack down on mortgage fraud and foreclosure rescue scams, and to identify other emerging trends and patterns."
