Fraud


n Suspicious Activity Reports (SARs) related to mortgage loan fraud jumped 35% in the first six months of 2007 compared with the first six months of 2006, according to a report by the Financial Crimes Enforcement Network. Mortgage loan fraud is now the third most common type of suspicious activity reported by depository institutions behind Bank Secrecy Act/structuring/ money laundering and check fraud.  FinCEN said it is preparing a more comprehensive analysis of mortgage fraud.

Other findings from FinCEN’s ninth issue of SAR Activity Review—By the Numbers show that non-depository institutions account for a growing percentage of SARs.  In 2001, depository institutions filed more than 95% of all SARs. In the first six months of 2007, almost 44% of SARs were reported by non-depository institutions, which include money services businesses, casinos and card clubs, and the securities and futures industries.

The review also noted a 58% jump in check kiting reports in the first half of 2007 compared with the first half of 2006. Terrorist financing reports for the first six months of 2007 from depository institutions increased 19% compared with the first half of 2006.

The complete report is available at www.fincen.gov/sars/sar_by_numb_09.pdf.

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