Mortgage fraud hits 'eye-opening' level in Canada, report says

Feb 22, 2013  - Consumer credit company Equifax uncovered roughly $400 million worth of mortgage fraud in Canada last year, an "eye-opening" number industry experts estimate represents only a fraction of the cheating taking place in the country's real-estate market.

"Mortgages are the biggest bang for the buck," said John Russo, vice-president and legal counsel for Equifax Canada Inc. "So when credit gets tougher to get, that leads to more people falsifying documents, giving false pay stubs, inflating their income, kind of fudging things to get a home."

The $400 million in mortgage fraud represents only a sliver of the roughly $1 trillion in total residential mortgage credit outstanding at the moment in Canada.

But it rose sharply in 2011 from 2010 in dollar terms, increasing 150 per cent, according to Equifax data.

The figure is "eye-opening," Russo says, because that's just the amount Equifax flushed out on its own for its clients. "There's a lot more out there that just goes under the radar and is not seen and not caught."

Often tracking strong housing markets, mortgage fraud occurs nationally but is more concentrated in large urban areas in Quebec, Ontario, Albert and B.C., according to the Criminal Intelligence Ser-vice Canada, a federal agency which shares intelligence between police forces.

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Marlene Ofter

Marlene Ofter

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