Fraud Indistinguishable From The Bubble

Mortgage fraud is increasing in a market where true values are becoming harder to discern. Could we be getting to a point where the con resembles the bubble itself? That would appear to be the case when the acts are no longer hidden.

"W-FIVE found plenty of people involved in questionable real estate deals. One man who has raised some eyebrows is Gohar Pervez, a convicted cocaine and methamphetamine dealer, now into real estate. On a number of his deals, ownership of the houses passes through the same associates and the same numbered companies time and time again. At any time, if Pervez chose to mortgage the houses, he'd be making serious money."

"The Bank of Montreal..claims it was defrauded of more than $1 million. Pervez maintains he's done nothing wrong. Det. Mike Shorter..has been working exclusively on mortgage fraud. When asked how many charges he has laid, Shorter says 'none.'"

The US has a problem as well. Chris Swecker, of the FBI said "We went from 4,000 complaints a year to 17,000. And we think that's just the tip of the iceberg."