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Federal Prosecutors Say Florida is “Ground Zero” for Mortgage Fraud Crimes

On the Shorstein & Lasnetski, LLC criminal law blog, we have discussed on several occasions the trends we have noticed with federal investigations and prosecutions of various crimes depending on what seems to be the prevailing issues of the day. One trend we have noticed recently is the increased focus by federal law enforcement officials on mortgage fraud crimes. This is obviously due to the massive collapse of the housing market and the number of foreclosures that resulted.

To further underscore this point, federal prosecutors in Florida have called Florida “ground zero” for mortgage fraud cases in the United States and are organizing their resources accordingly, according to a recent article on the Tampa, Florida news website. The Tampa, Florida article indicates that federal law enforcement officials in that area expect to have approximately 100 mortgage fraud cases charged or under investigation by the end of 2009. Because of the long time it takes to investigate and prosecute mortgage fraud cases in federal court, the U.S. Attorney for the Middle District of Florida said he expects each of his 105 assistant U.S. attorneys to handle the added workload.

We have seen similar articles and other evidence of an increase in mortgage fraud investigations and arrests in Jacksonville and other areas of Florida. We wonder if casting such a wide net for these cases and employing the efforts of law enforcement officials and prosecutors who may not have the experience handling mortgage fraud cases will result in a number of innocent people being caught up in this effort. We also wonder if the line between aggressive but legitimate business decision-making and criminal conduct will get blurred by such large scale investigative methods.

In any case, we will keep a close eye on the number, character and quality of mortgage fraud arrests and cases that are made out of Jacksonville, Florida and other areas of Florida and do our part to make sure those people who may have made an honest or legitimate business mistake are not categorized with anyone who can actually be proven beyond a reasonable doubt to have truly committed mortgage fraud.