Thursday, June 19, 2008
Free trip to Club Fed
Did you see the reports of the big FBI mortgage fraud sweep? They arrested over 400 people all across the US for various mortgage fraud schemes. They seem to have put together a fraud task force to investigate this mess. I don't think they have enough agents to even scratch the surface. Especially in the bubbliest of markets like CA, FL, NV and AZ. I also wonder if they will tackle the fraud by buyers. My guess is that they will not unless it's massive fraud, ala Casey Serin the poster boy of bubble fraud (and he's still walking the streets). I'd really love to see a few buyers go to jail as well as the agents and brokers that helped. I doubt it's gonna happen but I'll make a birthday wish and see what happens.
I don't think people realize how much fraud was going on. And most people don't realize how much of that 300% increase in price was due to fraud. Those fraudulent cash back sales were used as comps and raised the prices across the board.