According to the quarterly Mortgage Fraud Risk Report from Interthinx, there was a 22 percent decline in property valuation fraud risk over the previous year. Occupancy fraud risk increased 25 percent. Valuation fraud can occur at origination with inflated appraisals or on short-sale transactions with artificially low estimates, according to a June 2 MortgageDaily.com article. The Las Vegas metropolitan market had the worst index, according to the report, but its 524 index value is still down 20 percent from the previous quarter. Overall, the risk of appraisal fraud was down 12 percent over the last quarter of 2010. Occupancy fraud occurs when investors attempt to secure more favorable owner-occupied loan terms even though they don't intend to live in the property. The report showed a 25 percent increase in occupancy fraud risk in the first quarter of 2011. Overall the mortgage fraud risk index fell 5 percent over the last year, according to MortgageDaily.com.