State Regulatory Probe Reveals $45M Mortgage Fraud Scam; 88 Of 105 Homes Involved Ended In Foreclosure; Brokers, Buyers Pocketed $8M In Kickbacks

In Denver, Colorado, the Rocky Mountain News reports:

• A $45 million Front Range mortgage fraud scheme involving 105 home sales in 2006 resulted in 88 foreclosures after $8 million was kicked back to buyers and brokers, a state probe has found. "It's certainly the biggest case we have ever investigated," said Zachary Urban of the Colorado Division of Real Estate. "We would hope there isn't something bigger out there that we don't know about."

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• About three dozen real estate agents were involved in the suspect transactions. About a dozen of them have received sanctions from the real estate division, ranging from the revocation of their real estate licenses to small fines and requirements to complete education classes.

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• Erin Toll, director of the Division of Real Estate, has turned over information from the investigation to federal authorities including the FBI, the IRS, U.S. Postal Service and the Secret Service. "Our fight song is 'be the best at being first.' All we can do is take their licenses and impose fines," Toll said. "Other groups can bring criminal charges."

For more, see Colorado mortgage fraud probe uncovers kickbacks ($8 million wound up in pockets of buyers, brokers).

See also, The Denver Post: Builders untouchable in probe (State real estate agency explores mortgage fraud; IRS, FBI involved).