Suspicious Mortgage Fraud Activity Up 4% in 2010 says FinCEN

The number of suspicious activity reports (SARs) that indicate possible mortgage loan fraud increased 4% to 70,472 in 2010 according to the Financial Crimes Enforcement Network (FinCEN).

While the number of reports rose during the year, during Q4, the number of incidents fell 18,759, down 1% from the same period during 2009. In all, 11% of SARs filed in 2010 Q4 indicated mortgage loan fraud as an activity characterization, the same percentage as in Q4 of the previous year.

“FinCEN remains active with law enforcement and other partner agencies to provide lead information and to identify and combat potential abuses in the mortgage market,” said FinCEN Director James H. Freis, Jr. “As a member of the President’s Financial Fraud Enforcement Task Force, FinCEN is coordinating with the United States Trustee Program (USTP) and the Federal Bureau of Investigation (FBI) to identify potential mortgage loan fraud in a number of areas including identifying potential abuse of the bankruptcy system to facilitate mortgage fraud.”


In both 2010 and 2010 Q4, California and Florida were the highest ranked states based on total numbers of subjects, followed by New York and Illinois.  These four states consistently had the highest rankings every quarter of 2010 said the report.

During 2010 Q4, Los Angeles ranked highest among the 50 most populous Metropolitan Statistical Areas (MSAs), based on total MLF subjects, followed by New York, Chicago, and Miami. Per capita, Miami ranked highest, followed by Orlando, San Jose and Riverside, CA.

For 2010, rankings varied only slightly from Q4. New York ranked highest in annual MLF subjects, followed by Los Angeles, Chicago, and Miami. Miami still ranked highest in subjects per capita, with Las Vegas taking the 2nd spot, and San Jose and Riverside, CA retaining 3rd and 4th rankings.


FinCEN also reported that all types of SARs filed by depository institutions in 2010 fell 3% to 697,389 compared with 720,309 SARs filed by depository institutions in 2009. But, the total number of SARs filed in 2010 by all types of financial institutions covered by the Bank Secrecy Act grew nearly 4% to 1.3 million SARs up from 1.9 million filed in 2009.

View a copy of the annual report here.

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