Fraudulent investment schemes.

Borrowers obtained loans for multiple properties
within a short period of time. Frequently the subject properties were
located in states outside the borrower’s home state. The fraudulent activities
generally included appraisal fraud, occupancy fraud, fraudulent property
flipping, forged or fraudulent documents, and misrepresentation of assets and
debts. These schemes also included borrowers participating in fraudulent real
estate investment schemes by agreeing to have their personal credit used to
acquire mortgages in return for a fee plus the promise of additional commissions
when the property was resold. Investors were told the properties would
be renovated and sold in approximately one year, and that mortgage payments
would be made with rental income. The fraudulent activities generally included
appraisal fraud, asset rental fraud, occupancy fraud, straw buyer, and misrepresentation
of assets and debts. Ultimately the borrowers were left owing
mortgages that exceeded the property value.