By Aruna Viswanatha
WASHINGTON, March 17 Three Democratic lawmakers
on Monday asked to discuss with U.S. Attorney General Eric
Holder the Department of Justice's efforts to prosecute mortgage
fraud after a watchdog report last week said the FBI had ranked
it low priority.
U.S. Senator Elizabeth Warren and Representatives Elijah
Cummings and Maxine Waters are seeking an audience with Holder
over the report's finding that the FBI ranked mortgage fraud as
a low threat after the height of the financial crisis, even
though the Justice Department had said investigating that crime
would be a top priority.
"This report calls into question the Department's commitment
to investigate and prosecute crimes such as predatory lending,
loan modification scams, and abusive mortgage servicing
practices," the three lawmakers wrote of the report released
last week by the Justice Department's inspector general.
Justice Department spokeswoman Ellen Canale said the agency
strongly disagreed with the report. The department last week
said its mortgage fraud indictments had almost doubled and
convictions rose by more than 100 percent over the two years the
In recent years the government has been accused of not doing
enough to go after the kind of conduct that fueled the housing
crisis, including mortgage fraud.
Common mortgage fraud schemes include borrowers lying on
mortgage applications or scammers who promise relief to
borrowers facing foreclosure.
The report by the Justice Department's inspector general
found that even though the FBI had received $196 million in
funding to investigate mortgage fraud activities in the
aftermath of the crisis, its offices in New York, Los Angeles
and Miami ranked mortgage fraud as either a low priority or not
The trio asked to review the report's findings with Holder
and discuss steps the agency will take to improve its efforts to
prosecute the crimes.
Cummings, the ranking Democrat on the House Oversight panel,
Waters, the ranking member on the House Financial Services
Committee, and Warren, who is a member of the Senate Banking
Committee, have collaborated on similar efforts in the past.
Warren has been a vocal critic of what she sees as weak
government enforcement against financial misconduct.
Last month Warren and Cummings asked the Federal Reserve to
more often have its board of governors vote before the regulator
takes major enforcement actions against banks. Fed Chair Janet
Yellen has since pledged to increase the board's participation
on major actions.