Bill Would Prevent Mortgage Fraud by Illegal Aliens

[WhiskeyGirl]

Thursday February 18, 2010

A U.S. Congressman from Texas has just introduced a bill intended to prevent mortgage fraud by illegal aliens.

The Mortgage E-Verify Act, introduced by Rep. Kenny Marchant (R, Texas 24th), would require that the identity of all applicants for new or modified mortgages held by Fannie Mae or Freddie Mac or insured by the FHA, be confirmed through the E-Verify program of the Department of Homeland Security.

"My bill will potentially save millions by cutting down on fraudulent claims from illegal immigrants and protect taxpayers from subsidizing the restructuring or renegotiation mortgages of illegal immigrants," said Rep. Marchant in a press release.

Marchant cites Treasury Department data showing that incidents of mortgage fraud increased an estimated 1,411 percent from 1997 to 2005. "Furthermore, two-thirds of fraud reports in the last decade are due to falsified statements on loan documents," he noted. "My bill would curb these abuses and protect the taxpayers."

    There was a major case in Nevada where a mortgage company branch manager conspired to manufacture and submit false employment and income documentation for borrowers, most of whom were illegal immigrants. Fifty-eight of the 233 fraudulent FHA loans totaling $6.2 million have, not surprisingly, gone into default, costing HUD nearly $2 million. The branch manager was found guilty on 32 counts of submitting false information to HUD, and one count of conspiracy. -- U.S. Rep. Kenny Marchant press release.

The FBI defines mortgage fraud as "a material misstatement, misrepresentation, or omission relied upon by an underwriter or lender to fund, purchase, or insure a loan."

more here - http://usgovinfo.about.com/b/2010/02/18/bill-would-prevent-mortgage-fraud-by-illegal-aliens.htm

[WhiskeyGirl]

HR 4586 the Mortgage E-Verify Act

Rep. Kenny Marchant  (R-Texas) has introduced a new bill, the Mortgage E-Verify Act. It would require a mortgagor to be verified under the E-Verify program as a condition for modification of a home loan held by Fannie Mae or Freddie Mac, or insured by the Federal Housing Administration (FHA).

The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) estimates that mortgage fraud increased 1,411 percent from 1997 to 2005. In addition, Marchant says two-thirds of fraud reports in the last decade have been the result of falsified statements on loan documents.

“My bill would curb these abuses and protect the taxpayers,” Marchant said.

On his Web site, Marchant cites a case in Nevada where a mortgage company branch manager conspired to manufacture and submit false employment and income documentation for borrowers, most of whom were illegal immigrants.

Fifty-eight of the 233 fraudulent FHA loans, totaling $6.2 million, have gone into default, costing HUD nearly $2 million. The branch manager was found guilty on 32 counts of submitting false information to HUD, and one count of conspiracy.

more here - http://www.dsnews.com/articles/congressman-introduces-mortgage-e-verify-act-for-gse-and-fha-mods-2010-02-11