ID Theft & Mortgage Fraud

The American dream of owning a home is being turned into a nightmare by criminals who are stealing ID's to buy houses and fleece taxpayers out of millions of dollars. Attorney General Mark Shurtleff announced today that 21 people have been charged so far in a scheme that combines mortgage fraud and identity theft to produce what could become the costliest scam in state history.
A Salt Lake grandmother found out someone used her social security number to buy a $143,000 home in Layton. Marla Vandermyde says she has spent her entire life protecting her good name and good credit. "I felt sick and violated. It's devastating that someone can destroy your credit and everything you've worked hard for."

She's not alone. Here are some other examples:

A four-year-old New York girl's social security number was used to purchase a home in Ogden and the defendant received a $3000 check from Ogden for the down payment.
A 17-year-old Tremonton girl fears she will have trouble getting into college after her identity was used to purchase a house.
A Weber County woman's social security number was used to finance six homes, six cars and set up a credit account at R.C. Willey.

"You are at risk if you have a social security number or own a home," says Shurtleff. "We will do everything in our power to protect Utahns and bring the perpetrators to justice."
A joint investigation by the Utah Attorney General's Office, Office of Inspector General for Social Security Administration (SSA) and Office of Inspector General for the U.S. Department of Housing and Urban Development (HUD) has found 87 homes purchased by people using stolen social security numbers. The investigation is continuing and more charges are forthcoming.
"The Social Security Inspector General investigated these cases to protect the identities and social security numbers of U.S. citizens. These cases represent the worst instances of identity theft encountered in Utah," says Agent in Charge Ron Ingleby, Office of Inspector General for the SSA.
Here's how the scheme works: Promoters target illegal aliens to purchase homes with another person's social security number. The buyer pays as much as twice what the property is worth and inevitably loses the home in foreclosure. Since the home is federally insured, taxpayers end up paying for the fraud and the cost of mortgage insurance goes up. Meanwhile, the legitimate holder of the social security number has to spend an enormous amount of time and money to repair their damaged credit.
Victims will likely need to remove $100,000 to $400,000 from their credit reports before they will be able to complete a major transaction like refinancing a home or buying a car. The government has already lost $2.5 million on just a handful of the properties.
"Property flippers and profiteers strike at the very heart of the economic vitality of this country. The recent initiative here in Salt Lake City is an example of HUD's nationwide efforts to combat mortgage fraud and protect America's home buyers and the housing industry," says Special Agent in Charge Rebecca J. Kiser, Office of Inspector General for HUD.
The Federal Trade Commission estimates that one in eight adults-about 175,000 Utahns---have had their identities stolen during the past five years.
Here are some tips that can help you from becoming the next victim:

Do not disclose personal information unless you know how it will be used.
Check your credit report and request a report involving all transactions with your social security number rather than your name.
Ask your bank or credit union to require a photo ID and a password for all transactions from your account.
Here are some ways lenders can prevent problems:

Ask more questions about a customer's background before granting credit.
Check to see that the name, social security number and address are consistent on all reports and applications.
Make sure third-party service providers and their partners have adequate security to protect access to personal data.