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67 Arrested In Mortgage Fraud Sweep

By Margaret Lyons in News on Jun 19, 2008 8:07PM

The feds arrested 67 people in Chicago today for mortgage fraud. "Operation Malicious Mortgage" is trying to bust people who cost borrowers around $1 billion, according to the Justice Department. More than 400 people have been arrested nationally in 144 fraud cases, and locally, 33 people have been charged in two related schemes that involved $111 million in fraudulent loans.

Authorities targeted three growing scams: lending fraud involving false loan applications and bogus real estate appraisals; foreclosure rescue scams where financially strapped homeowners lose ownership of their properties to criminals; and mortgage-related bankruptcy fraud.

US Attorney Patrick Fitzgerald said in a statement that "mortgage fraud inflicts serious damage upon financial institutions but, more importantly, makes life more difficult for ordinary citizens." Hm, busy week for Fitzgerald. [Trib, Crain's]