Tuesday, August 13, 2013

DOJ's Admission: Our Mortgage Fraud Numbers Were Phony

by: Soloman L. Wisenberg

Well, DOJ didn't admit it in those exact words. The tone and content were more Ziegleresque: "[T]he announcement overstated the number of defendants that should have been included as part of the Distressed Homeowner Initiative, as well as the corresponding estimated loss amount and number of victims." The original press release and press conference in October 2012 touted "the results of the Distressed Homeowner Initiative, the first-ever nationwide effort to target fraud schemes that prey upon suffering homeowners. The yearlong initiative, launched by the FBI, a co-chair of the Financial Fraud Enforcement Task Force’s Mortgage Fraud Working Group, resulted in 107 criminal defendants charged in U.S. District Courts across the country. These cases involved more than 17,185 homeowner victims and total losses by those victims estimated by law enforcement at more than $95 million." It turns out the numbers given for people arrested, victims affected, and losses incurred were grossly inflated. Jonathan Weil's blistering Bloomberg.com column discussing the rigged numbers is here. The original press release and Newspeak retraction are here. No doubt DOJ is working up a Section 1001 case right now against the folks who gave out these numbers. I don't usually quote socialists, but I.F. Stone's favorite saying now comes to mind: "All governments are run by liars." Hat Tip to Professor William Black for bringing this story to my attention.

(wisenberg)

http://lawprofessors.typepad.com/whitecollarcrime_blog/2013/08/dojs-admission-our-mortgage-fraud-numbers-were-phony.html

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