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A yearlong Department of Justice and FBI initiative to protect distressed borrowers from foreclosure rescue scams resulted in charges against 530 accused con artists and the uncovering of $1 billion in losses. 

The DOJ and FBI led the offensive known as the Distressed Homeowner Initiative, a part of the Financial Fraud Task Force. The program combined the investigative, regulatory and law enforcement talents of the DOJ, HUD, the FBI as well as the FTC and other federal officials who wanted to stomp out fraud against distressed homeowners.

“We recognize the negative impact that mortgage fraud and foreclosures have on our economy and on our communities. We cannot merely investigate after the fact," said FBI associate deputy director Kevin Perkins.

The DOJ activity is unrelated to today's announcement from the Federal Trade Commission, which filed lawsuits against three alleged mortgage relief fraudsters.

The year-long initiative ended up revealing 73,000 victims of foreclosure and mortgage-rescue fraud. Many of the victims gave accused con artists their money thinking they could obtain loan modifications. Other victims were told the accused scammers could get investors to acquire the property. In those cases, the victim generally ended up losing their title and everything else to the scam artists.

The list of 530 defendants charged with crimes includes 172 executives. The accused actions led to a total of 285 federal criminal indictments and related filings at U.S. district courts across the country.

"These comprehensive efforts represent an historic, government-wide commitment to eradicating mortgage fraud and related offenses," said Attorney General Eric Holder. "The success of the Distressed Homeowner Initiative, and the developments we announce today, underscore our determination to pursue these and other financial fraud criminals around the country."

The initiative ran from Oct. 1, 2011 through Sept. 30, 2012.

The program was launched initially by the FBI, an agency that serves as co-chair for the Financial Fraud Enforcement Task Force Mortgage Fraud Working Group.

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