DOJ pushes back on mortgage fraud report

The Justice Department is pushing back against findings in an internal report that the agency did not place a high enough priority on clamping down on mortgage fraud. 

On Thursday, the Justice Department’s inspector general said it found that the agency repeatedly overstated its efforts and cited flawed data on the effectiveness of new initiatives aimed at rooting out and prosecuting abuses in the mortgage market, according to an internal investigation.

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“The facts regarding the department’s work on mortgage fraud tell a much different story than this report,” Justice spokeswoman Ellen Canale said in an email to The Hill. 

“In the time period in question, the number of mortgage fraud indictments nearly doubled, and the number of convictions rose by more than 100 percent."

Convictions rose every year and doubled between 2009-2011, increasing to 1,087 from 555, according to Justice Department figures.

“As the report itself notes, even at a time of constrained budget resources, the department has dedicated significant manpower and funding to combatting mortgage fraud," Canale said. 

Justice received $196 million to ramp up hiring to investigate mortgage fraud cases, but the report determined that in 2011 the number of FBI agents investigating mortgage fraud, as well as the number of pending investigations, decreased.

The agency argues that the report contradicts itself in several areas, including its assertion that the agency didn't make mortgage fraud as high a priority behind the scenes as it was touted in public.

The IG report did point out several instances where the agency has made efforts to give the issue a higher priority.

There were two examples cited that supported its public statements of focusing on the problem, including collaboration with more than 90 local task forces.

Still, the report said that "DOJ did not uniformly ensure that mortgage fraud was prioritized at a level commensurate with its public statements." 

Rep. Elijah Cummings, ranking member of the House Oversight and Government Reform Committee, said he is “deeply troubled” by the report and would ask Attorney General Eric Holder for a meeting to discuss findings. 

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