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Feds Crack Down On Mortgage Fraud

DEBORAH AMOS, host:

The Obama administration is reporting progress cleaning up the mortgage industry. Yesterday Attorney General Eric Holder announced fraud changes against more than 1,200 people.

NPR's Carrie Johnson has our story on what the government is calling Operation Stolen Dreams.

CARRIE JOHNSON: The attorney general didnt mince any words about the importance of this issue.

Attorney General ERIC HOLDER (Justice Department): If you prey on vulnerable homeowners or engage in fraudulent conduct, we will find you and we will bring you to justice.

JOHNSON: The FBI is investigating 3,000 cases of mortgage fraud and more may be in the pipeline. The Obama administration is under a lot of pressure to bring criminal cases, and foreclosures are still on the rise.

Holder says fraud is taking on different forms in different parts of the country.

Atty. Gen. HOLDER: We have seen mortgage fraud take on all shapes and sizes -from schemes that ensnare the elderly to fraudsters who have targeted immigrant communities.

JOHNSON: For instance, in Miami, criminals have been preying on Haitian immigrants. They lured victims in by promising help with immigration issues. Instead, they stole their identities to secure phony mortgages. Most of the people arrested in the mortgage fraud sweep are relatively small fish, and so far no major companies have been charged with mortgage crimes, or in connection with the big economic meltdown.

The Justice Department wants another $180 million in next year's budget to hire investigators and prosecutors to step up their efforts against mortgage fraud.

Carrie Johnson, NPR News, Washington. Transcript provided by NPR, Copyright NPR.

Carrie Johnson is a justice correspondent for the Washington Desk.
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