Hundreds arrested in mortgage fraud roundup.

[SirNitram]

Link

WASHINGTON (CNN) -- Hundreds of people across the country have been arrested by law enforcement officials targeting crooked mortgage brokers, real estate agents, and other industry officials, the head of the FBI and a top Justice Department official said Thursday.

FBI Director Robert Mueller and Deputy Attorney General Mark Filip announced the arrests the same day two former Bear Stearns hedge fund managers, Ralph Cioffi and Matthew Tannin, surrendered to the FBI. The men are expected to face federal charges that they intentionally misled investors in two funds that collapsed last summer under the weight of wrong-way bets on mortgage-backed securities.

More than 400 people have been charged in the mortgage fraud probe, of whom nearly 300 have been arrested, including 60 in a coordinated sweep Wednesday, the Justice Department said.

The losses in the mortgage fraud cases cost consumers more than $1 billion, Mueller said.

"We will, as appropriate, seek prison terms," Filip said. "It is a very, very serious matter."

"Operation Malicious Mortgage," the investigation by the FBI and Justice Department, began March 1, government officials said. It resulted in 144 fraud cases in which 406 defendants were charged.

The FBI is investigating about 1,400 more cases of potential fraud, Mueller said, calling it "a substantial number of investigations, unfortunately."

The agency has 42 mortgage fraud task forces in operation, employing 180 agents, Mueller said.

Many agencies were credited as contributing to the investigation, including the Internal Revenue Service, the Secret Service, the Department of Housing and Urban Development, immigration and customs agencies, postal inspectors and the Federal Deposit Insurance Corporation.

Most of the arrests came Wednesday, federal law enforcement officials said, in Miami, Houston, San Antonio, Baltimore, Chicago, and other cities.

Officials indicated the suspects were involved mostly in small-scale schemes.

Bear Stearns was only a bubble in the steam pot of filth.

[phongn]

Bear Stearns was only a bubble in the steam pot of filth.

Er, what? $1bn in fraud - while certainly a large sum of money - is only a small part of the overall losses the industry has taken. The article further notes that most of these schemes were "small scale," and we don't know the distribution of those projected 1400.

[SirNitram]

Bear Stearns was only a bubble in the steam pot of filth.

Er, what? $1bn in fraud - while certainly a large sum of money - is only a small part of the overall losses the industry has taken. The article further notes that most of these schemes were "small scale," and we don't know the distribution of those projected 1400.

Well, given there were two specifically said by Bear Stearn, I think we can conclude some other places were hit.

[phongn]

Well, given there were two specifically said by Bear Stearn, I think we can conclude some other places were hit.

Clearly, but your commentary implied that fraud was endemic and systematic to the mortgage industry and the resultant losses.

[SirNitram]

Well, given there were two specifically said by Bear Stearn, I think we can conclude some other places were hit.

Clearly, but your commentary implied that fraud was endemic and systematic to the mortgage industry and the resultant losses.

While I wouldn't be surprised at all, given the NINJA(No Income, No Job or Assets) loans somehow getting approved, I gave the wrong implication. Sorry.