Thousands of criminals sold mortgages in Florida

Interesting story from Sunday's Miami Herald that documents the thousands of criminals who flocked to the mortgage business, in many cases continuing their fraudulent lifestyle by duping banks. They exploited a Florida loophole that doesn't require mortgage broker licenses for so-called "loan originators":

A review of thousands of pages of court documents, state industry reports, internal e-mails and police reports shows that from 2000 to 2007, 5,306 people with criminal histories became loan originators -- a rate of nearly two a day. Worse, those include 2,201 who had committed financial crimes, such as fraud, money laundering and grand theft.

The more you read, the more you realized that much of our current housing problem stems from a grotesquely lax credit system allowing fraud to proliferate. Keep in mind that even if these loan originators gamed the system, they all worked under supervision of a licensed mortgage brokers. Where was the oversight?

Comments

[k]

"Where was the oversight?"
http://www.flofr.com/Director/aboutcommissioner.htm
Let the Gator-Haters have their day.
Fact is, they (FLOFR) will pawn it off on legal loopholes that would be the responsibility of the don't-fix-it-if-it-ain't-broke state legislators.

[Fuzzy Bear]

Where was the oversight?

1. There was no oversight by the mortgage brokers associations or brokers during 2000-2006

2. There was no oversight by state federal and local goverments to protectthe consumer during the housing boom.

3. There was no oversight by the realtor associations duringthe housing boom and the same Hype continues today via the NAR with their false and misleading advertisments.

4. There was little to no underwriting or oversight by the banks during the housing boom.

5. There was no oversight or regulation enforcement of Wallstreet duringthe boom.

6. PMI insurers failed to due their due diligence.

7. Ratings companies failed in their oversight through false and misleading ratings.

9. Adjusters failed to regulate their industry during the housing boom years.

10. The consumer/investor failed to do their due diligence and instead relied upon those in this industry for advice.

Bottom line, the lax oversight and commision/fee based industry drove the housing industry into a frenzy via greed and illegal activity. The state of Florida lawmakers and regulators failed the voters during the housing boom!