Illinois Leads Mortgage Fraud Filing Increases at 76 Percent: What a Victim Can Do

FinCEN reports Illinois led the country in increased filings of suspected mortgage fraud. Here's what a mortgage fraud victim can do.

Aurora, IL, April 18, 2008 --( In a report issued this week by the Financial Crimes Enforcement Network (FinCEN), Illinois led the country in increased filings of suspected mortgage fraud. The report covers filings by financial institutions during calendar year 2006.

Nationwide, FinCEN reports that mortgage fraud filings were up 44 percent. The Illinois increase was 75.8 percent.

"Representing more than 20 clients who are victims of fraud in Illinois which involve properties valued at more than $50 million, this finding comes as no surprise," said Joseph P. McCaffery, an Illinois attorney who specializes in fraud litigation.

The FinCEN data also shows that mortgage brokers initiated the loans on the majority (58 percent) of the Suspicious Activity Reports (SARs) sampled for the report. According to the executive summary, SAR reporting includes examples of brokers acting both as active participants in the reported fraudulent activity, and as intermediaries that did not verify information submitted on the loan application. McCaffery says these acts are consistent with the evidence in the mortgage fraud schemes that victimized his firm's clients.

Identity theft victims also have had their properties encumbered with loans or property titles fraudulently transferred, and according to FinCEN, the incidence of identity theft in conjunction with mortgage load fraud increased a whopping 95.62 percent. Oftentimes, it is through a call or letter from a collection agency or mortgage holder that a victim first learns of the fraud and/or identity theft. As such, the matter already has reached a crisis level where loss of the victim's home or destruction of their credit is at risk. What to do? McCaffery says there are several steps a mortgage fraud victim can take:

Contact and cooperate with law enforcement - Chances are there is not a lone victim of the fraud. An individual situation may provide a missing link in a larger unsolved or unproven case.

Alert credit reporting bureaus - Be sure that the appearance of any loan defaults are marked as disputed and under investigation. This may not immediately redeem the victims' credit scores, but it is a critical step toward repairing any damage once the fraud is proven.

Secure full-service legal counsel - Select legal representation that specializes in crisis litigation and protecting the interests of its clients, in and out of court.

"We work closely with local and federal law enforcement to secure criminal indictments against the purveyors of the fraud and ensure our clients are recognized as victims rather than participants in illegal activity," said McCaffery. "We represent our clients in front of the creditors involved to protect their property and/or credit, and relieve them of nuisance collection calls, as well as provide assistance in managing properties that our clients are held legally responsible for until the matters are cleared."

This includes dealing in court with municipalities who may levy fines or even have a tear-down order on an apparently abandoned property, to avoid such actions and sustain any value that may be used in negotiating with creditors.

"Finally," said McCaffery, "Victims can file civil litigation against the participants in the fraud to collect for damages and suffering."

Individuals or groups who are among the increasing numbers of mortgage fraud victims in Illinois can fight back. For more information, contact Joseph P. McCaffery & Associates at 630-801-8691 or

Joseph P. McCaffery & Associates
Starr McCaffery