Some Progress! The DOJ announced a major bust on mortgage fraud, with a nice title too, Operation Stolen Dreams.

The nationwide initiative called Operation Stolen Dreams is the largest collective enforcement effort aimed at confronting the problem of mortgage fraud, Attorney General Eric Holder told a news conference. It involves 1,215 criminal defendants in cases that uncovered more than $2.3 billion in losses.

The Justice Department also has engaged in civil enforcement actions to recover more than $147 million in the operation.

This was the largest criminal action on mortgage fraud in history. From the Department of Justice press conference:

In Miami, just yesterday we unsealed an indictment and arrested two defendants who allegedly targeted the Haitian-American community, often claiming they would assist them with immigration and housing issues, but then instead using victims’ personal information to produce false documents to obtain mortgage loans.

In Chico, California, a prominent home builder, caught with a significant amount of unsold new homes as the housing market cooled, allegedly used straw buyers to sell his houses at inflated prices with undisclosed sales rebates. This scheme inflated prices on other homes in the area, creating artificially high comparable sales and affecting the overall new-home market. To date, thirty-eight of the homes have fallen into foreclosure and ten more have been the subject of short sales – all in one city.

In Detroit, just yesterday we charged several individuals who are part of a more than $100 million, 70-plus person "ghost loans" scheme. The conspirators posed as mortgage brokers, appraisers, real estate agents and title agents and used straw buyers to obtain around 500 mortgages on only 180 properties.

The DOJ is requesting more funding to further investigate and prosecute more cases.