Real estate agent among 123 accused in mortgage fraud investigation

Sam Morris / Las Vegas Sun.

IRS Criminal Investigation Special Agent in Charge Paul Camacho informed the media on Thursday June 17, 2010 of a nationwide investigation targeting mortgage fraud across the country. The operation has resulted in 123 people in southern Nevada being indicted, convicted, or related to the probe.

Updated Thursday, June 17, 2010 | 6:19 pm

A nationwide search aimed at mortgage fraud across the country has resulted in 123 people in southern Nevada being charged, convicted or convicted in connection with the investigation.

The announcement was made in federal court of Lloyd D. George in downtown Las Vegas on Thursday. The investigation was known as Operation Stolen Dreams.

Authorities said the defendants allegedly involved hundreds of “straw buyer” transactions involving hundreds of properties in the Las Vegas area, with a total loss of more than $ 246 million.

Officials said 73 of the 123 suspects in the case worked in the local real estate industry, including 30 loan officers, 24 real estate agents, six loan officers, five clearing agents, four mortgage brokers, two appraisers and a building contractor. Charges against 72 of the 123 suspects were filed this week, US Attorney General Natalie Collins said.

The Southern Nevada Mortgage Fraud Task Force conducted 25 criminal investigations during the investigation.

“These 25 identified criminal investigations are just the beginning and comprise only part of the active case and current workload of the Mortgage Fraud Task Force,” said US Attorney for Nevada Daniel G. Bogden.

Further investigations are expected in the coming months.

“The Southern Nevada Mortgage Fraud Task Force has hundreds of cases to investigate,” said Kevin Favreau, the special agent for the FBI’s Las Vegas office.

Nationwide, the investigation has resulted in officials identifying 1,215 defendants, resulting in about 500 arrests with alleged losses of over $ 2.3 billion, officials said.

Southern Nevada is particularly badly hit by mortgage fraud.

“Few of the FBI offices have seen as much real estate fraud as here in southern Nevada,” said Favreau.

The Greater Las Vegas Association of Realtors released a statement this afternoon commending officials for investigating fraud in the industry, saying its 12,500 members are barred from participating in the type of programs prosecutors claim.

“We support and partner with such efforts by local, state and federal regulators and law enforcement agencies to aggressively investigate and prosecute anyone in the real estate industry who is suspected of fraud,” Association President Rick Shelton said in the statement. “The fraudulent activity alleged by the Southern Nevada Fraud Task Force is harmful to homeowners, law abiding members of the real estate industry, and the general public. GLVAR members receive the highest professional training and must adhere to a strict code of ethics that prohibits such behavior. “

While these nationwide efforts to stop mortgage fraud began on March 1, the local task force was formed in 2008 after the FBI found an increase in the number of complaints in the summer of 2007, Favreau said.

As property prices began to fall in southern Nevada, it became harder for criminals to carry out their scams, officials said.

FBI Supervisory Special Agent Scott Hunter said many of the homes involved in the scams ended up being foreclosed.

“They used these houses like ATMs,” Hunter said of the suspected fraudsters. “They took as much money out of them as possible and when they finished with the money they left it and basically left southern Nevada in a wreck.”

The alleged fraud artificially inflated property values ​​in the neighborhoods where the scams took place, resulting in innocent homebuyers overpaying and having a higher chance of foreclosure when the economic hardship hit, Hunter said.

Authorities who participated in the Nevada investigation include the FBI, the US Housing and Urban Development Office of the Inspector General, the US Postal Inspection Service, the Secret Service, the IRS Criminal Investigation Unit, the Office of the Inspector General of the Social Security Administration and Metro Police.

Anyone with information about mortgage crime can contact the task force at (702) 584-5555.

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