AG: 200 companies under investigation for mortgage fraud

By Cy Ryan

Monday, Feb. 21, 2011 | 11:12 a.m.

CARSON CITY – More than 200 companies are under criminal investigation for mortgage fraud with ties to such things as identity theft and prostitution, Attorney General Catherine Cortez Masto says.

Edith Cartwright of the attorney general’s office said many of those companies have 50 to 100 complaints against them.

Masto outlined her budget to the Assembly Ways and Means Committee on Monday, saying she has two attorneys and three investigators to handle the criminal cases. The office also has a federal grant to hire two lawyers and four more investigators.

Masto said the investigations center on mortgage foreclosure rescue scams or loan modification scams.

“They are looking at various ways to scam people,” the attorney general said. “This is the easiest to set up shop and try to start taking dollars from mortgage fraud. But they are organized and they engage in other types of crime besides the mortgage fraud."

At the same time, the state Division of Mortgage Lending took 82 disciplinary actions against companies last year, revoking or suspending their licenses and imposing fines of as much as $40,000.

So far this year the division has filed 16 complaints against these mortgage companies, most of them in Las Vegas.

Masto said that while investigating these mortgage cases, authorities have uncovered other illegal activities in some cases, such as links to child pornography, fake Social Security cards and in one case and individual on the United Kingdom’s mafia top 10 wanted list.

“In one case there was a blood diamond exchange … a diamond from Africa,” Masto said.

The attorney general’s office has criminal complaints against 16 companies in Clark County and 51 cases are designated for civil handling.

So far there have been convictions against 20 defendants with $670,132 recovered for victims.