Lawmakers Seek Answers on Lack of Mortgage Fraud Prosecutions

March 18, 2014
Headlines

A new internal report says the Justice Department massively overstated its successes in targeting mortgage fraud while in fact ranking it as a low priority for investigation. The Justice Department’s inspector general says despite playing a central role in the nation’s financial crisis, mortgage fraud was deemed either a low priority or not a priority at all. In one instance, Attorney General Eric Holder claimed to have filed lawsuits on behalf of homeowner victims for losses totaling more than $1 billion, but the actual amount was 91 percent less, around $95 million. On Monday, three Democratic lawmakers — Senator Elizabeth Warren and Congressmembers Elijah Cummings and Maxine Waters — asked Holder for a meeting to discuss the lapse. In a letter, the three said: "This report calls into question the Department’s commitment to investigate and prosecute crimes such as predatory lending, loan modification scams and abusive mortgage servicing practices." In a separate statement, Republican Senator Charles Grassley of Iowa was more critical, saying the Justice Department "wasted time cooking the numbers about the cases it pursued, when it should have been prosecuting cases."