On March 16, the Financial Crimes Enforcement Network, an agency of the U.S. Treasury (FinCEN), released a report entitled Mortgage Loan Fraud Connections with Other Financial Crime that outlines how subjects reported by depository institutions to the agency for suspected mortgage loan fraud may also be involved in other financial crimes such as check fraud, money laundering, stock manipulation, currency structuring to avoid transaction reporting requirements and other crimes. In the course of its review of a five year period, FinCEN identified approximately 156,000 mortgage fraud subjects and found that approximately 2,360 were reported for suspicious activity in 3,680 of the other reporting categories.
The report analyzed Suspicious Activity Reports (SARs) filed by depository institutions for mortgage fraud between July 2003 and June 2008. After pulling such SARs, the agency then looked at SARs filed by money services businesses, securities brokers and dealers or insurance companies, and by casinos and card clubs. In reviewing the SARs collectively, the reports provided information about ways in which the mortgage loan fraud subjects identified in SARs filed by depository institutions reportedly hid, moved or disposed of large sums of cash.
According to the Executive Summary, the purpose of the study was to “better understand the relationship between mortgage loan fraud and other financial crime and to identify ways in which financial crime extends through multiple financial industries.”