Mortgage Fraud 2010 Legislation

Last Updated: September 22, 2011

NCSL Staff Contact: Heather Morton, Denver, (303) 364-7700

This page addresses residential mortgage fraud issues. The legislation tracked under this category relates to creating a specific crime for mortgage fraud. Eight states had pending legislation in the 2010 legislative session. Three states enacted legislation regarding mortgage fraud. Georgia authorized the Georgia Bureau of Investigation to investigate certain offenses involving fraudulent real estate transactions and provided the Georgia Bureau of Investigation subpoena power for such investigations. Massachusetts created a residential mortgage fraud offense. Utah modified the dollar value of damage that determines the levels of offense for mortgage fraud offenses.

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STATES
BILL SUMMARY
Alabama
none
Alaska
none
Arizona
none
Arkansas
none
California
none
Colorado
none
Connecticut
none
Delaware
none
District of Columbia
none
Florida

S.B. 2094
Died in committee 4/30/10
Expresses the legislative intent to revise laws relating to mortgage fraud.

Georgia

H.B. 1271
Relates to general provisions relative to grand juries, so as to provide that a victim of commercial mortgage fraud shall have the right to present a case to the grand jury; provides for duties of the grand jury; amends Chapter 8 of Title 16 of the Official Code of Georgia Annotated, relating to offenses involving theft, so as to enact the "Georgia Commercial Mortgage Fraud Act"; provides legislative findings; provides for definitions; defines the criminal offense of commercial mortgage fraud; provides for venue; provides penalties; mandates investigations by district attorneys and the attorney general or by investigative referral to the Georgia Bureau of Investigation; authorizes district attorneys and the attorney general to prosecute cases of commercial mortgage fraud; provides for the forfeiture of real and personal property; amends Code §16-14-3 of the Official Code of Georgia Annotated, relating to definitions relative to racketeer influenced organizations, so as to include commercial mortgage fraud within the definition of racketeering activity.

 

S.B. 371
Signed by governor 6/4/10, Act 678
Relates to residential mortgage fraud and the Georgia Bureau of Investigation, respectively, so as to provide the Georgia Bureau of Investigation with the authority to investigate certain offenses involving fraudulent real estate transactions; provides the Georgia Bureau of Investigation subpoena power for such investigations.

Guam
none
Hawaii
none
Idaho
none
Illinois
none
Indiana
none
Iowa
none
Kansas
none
Kentucky
none
Louisiana
none
Maine
none
Maryland
none
Massachusetts

H.B. 3571
See H.B. 4595 4/8/10
Creates crime of residential mortgage fraud.

 

H.B. 3692
See H.B. 4595 4/8/10
Acts to stabilize neighborhoods; creates crime of residential mortgage fraud.

 

H.B. 4595
Acts to stabilize neighborhoods; creates crime of residential mortgage fraud.

 

H.B. 4934
Acts to stabilize neighborhoods; creates crime of residential mortgage fraud.

 

S.B. 1379
See S.B. 2355 4/1/10
Acts to stabilize neighborhoods; creates crime of residential mortgage fraud.

 

S.B. 1846
Criminalizes mortgage fraud.

 

S.B. 2355
See S.B. 2394 4/26/10
Acts to stabilize neighborhoods; creates crime of residential mortgage fraud.

 

S.B. 2394
See S.B. 2407 4/29/10
Acts to stabilize neighborhoods; creates crime of residential mortgage fraud.

 

S.B. 2407
Signed by governor 8/7/10, Chapter 258
Provides for tenant protections in foreclosed properties; provides for the right to cure defaults; provides for an abandoned property registry; provides for negotiations upon alternatives to foreclosure; creates crime of residential mortgage fraud.

Michigan

H.B. 6513
Revises statute of limitations for false pretenses relating to real property or mortgage fraud.

 

H.B. 6518
Prohibits residential mortgage fraud generally.

 

H.B. 6519
Enacts sentencing guidelines for crime of mortgage fraud.

 

S.B. 1518
Prohibits residential mortgage fraud.

 

S.B. 1519
Enacts sentencing guidelines for crime of mortgage fraud.

 

S.B. 1522
Revises statute of limitations for false pretense, forgery, or uttering or publishing an instrument affecting an interest in real property, or mortgage fraud.

Minnesota
none
Mississippi
none
Missouri
none
Montana
none
Nebraska
none
Nevada
none
New Hampshire
none
New Jersey

A.B. 644
This bill, the “Truth in Mortgaging Act,” creates the crime of residential mortgage fraud. Under the terms of the bill, a person is guilty of the crime of residential mortgage fraud when, with the intent to defraud, that person knowingly makes, or causes to be made, any false, fictitious, fraudulent or misleading statement of material fact in, or omits a material fact from, or causes a material fact to be omitted from, any record or other document, in writing, electronically, orally or in any other form, during the mortgage lending process, with the intention that it be relied on by a mortgage lender, borrower or any other party to the mortgage lending process, or knowingly uses or facilitates the use of any such misleading statement or omission. A "material fact" includes but is not limited to: (1) any fact relating to the value of the real property that provides the collateral to secure the repayment of a residential mortgage loan; and (2) any fact relating to the current or expected income, financial obligations, or employment of a person who seeks or obtains a residential mortgage loan, relevant to the person’s ability to repay the loan. This bill provides that a person who commits the offense of residential mortgage fraud is guilty of a crime of the third degree and subject to imprisonment for a term of three to five years and to a fine not to exceed $15,000, or both. The bill also provides that a person who engages in a pattern of residential mortgage fraud is guilty of a crime of the second degree and subject to imprisonment for a term of five to 10 years and to a fine not to exceed $150,000, or both. Each residential property transaction subject to the act shall constitute a separate offense and shall not merge with other crimes. In addition, where an assignment judge determines that the infraction is de minimus, the assignment judge may dismiss the prosecution of residential mortgage fraud. In order to facilitate uniform enforcement, the bill directs the attorney general to develop prosecution guidelines for dissemination to each of the county prosecutors within 180 days of the effective date of the act.

 

S.B. 1679
This bill creates the crime of residential mortgage fraud. This bill provides that a person who commits the offense of residential mortgage fraud is guilty of a crime of the third degree and subject to imprisonment for a term of three to five years and to a fine not to exceed $15,000, or both. The bill also provides that a person who engages in a pattern of mortgage fraud is guilty of a crime of the second degree and subject to imprisonment for a term of five to 10 years and to a fine not to exceed $150,000, or both. Each residential property transaction subject to the act shall constitute a separate offense and shall not merge with other crimes. In addition, where an assignment judge determines that the infraction is de minimus, the assignment judge may dismiss the prosecution of mortgage fraud. In order to facilitate uniform enforcement, the bill directs the attorney general to develop prosecution guidelines for dissemination to each of the county prosecutors within 180 days of the effective date of the act.

New Mexico
none
New York

A.B. 8917
Enacting clause stricken 1/25/10
S.B. 51105
Relates to home mortgage loans, the crime of mortgage fraud and the filing of transfers and assignments of mortgages.

 

S.B. 5931
Enacting clause stricken 1/11/10
Relates to home mortgage loans, the crime of mortgage fraud and the filing of transfers and assignments of mortgages.

North Carolina
none
North Dakota
none
Ohio
none
Oklahoma
none
Oregon
none
Pennsylvania
none
Puerto Rico
none
Rhode Island

H.B. 7784
Makes residential mortgage fraud a felony, and extends the statute of limitations for certain offenses.

 

S.B. 2657
Makes residential mortgage fraud a felony, and extends the statute of limitations for certain offenses.

South Carolina
none
South Dakota
none
Tennessee
none
Texas
none
Utah

S.B. 10
Signed by governor 3/26/10, Chapter 193
This bill modifies the dollar value of damage that determines the levels of offense for offenses, including arson, criminal mischief, theft, various fraud offenses, unlawful dealing by a fiduciary, destruction of livestock, reckless burning, computer crimes, bad checks, mortgage fraud, and theft of utility services.

Vermont
none
Virginia
none
Washington
none
West Virginia
none
Wisconsin
none
Wyoming
none

 

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