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Jun 20, 2008 8:23 pm US/Central
Local FBI Cracking Down On Mortgage Fraud Scams
Reporting
Jack Fink
DALLAS (CBS 11 / TXA 21) ―
The number of alleged mortgage fraud scams has doubled across North Texas over the past three years, and there is a nationwide crackdown aimed at putting them to an end.
"Mortgage fraud basically ruined our street," said north Dallas resident Ceil Breitwieser. All she had to do was look across the street to see the scam at work. While the house is now being properly cared for by good owners, it was once an eyesore, along with several others on the block.
"The neighborhood started going downhill," Breitwieser explained. "Five homes that were not being taken care of went into disrepair. The outside started looking bad. The pools, the yards."
As CBS 11 News first reported on Wednesday, the FBI and federal prosecutors charged 11 people in Dallas with taking part in a mortgage fraud scheme.
The alleged ringleader, Eric Farrington, is a motivational speaker. Prosecutors say that one of the houses in the alleged scheme is in Farrington's own guard-gated community in the Las Colinas Golf and Sports Club.
CBS 11 News attempted to contact Farrington at his home, but the guard at the community's gate said that Farrington did not answer his phone.
Those charged are accused of illegally inflating the prices of homes by as much as $100,000 to $200,000 so they could obtain larger loans and ultimately make more money on the deals.
But prosecutors say that the recruited buyers never paid the mortgages and the homes went into foreclosure.
This is a growing problem. The FBI said that $1 billion has been lost, nationwide, since March 2008. The FBI's Dallas office ranks fourth in the nation in mortgage fraud investigations. The problem has become so bad that, when the Texas Attorney General's Office set up its own mortgage fraud task force last fall, 70 percent of the complaints came from the Dallas area.
If convicted, Eric Farrington faces years in prison and millions of dollars in fines.
"I really hope they throw the book at him," said Breitwieser. "He deserves it. He really does."
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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