Mortgage origination fraud and the global economic crisis: A criminological analysis
Mortgage fraud has been a major topic of concern of social scientists and economists since the beginning of the 2008 economic downturn. This chapter discusses basic relevant background information concerning mortgage fraud and the complex nature of the loan origination process. This discussion helps to better understand the complex nature of mortgage fraud and its role in the subprime mortgage crisis. To understand the relationship between mortgage fraud and the global economic crisis better, it is instructive to consider financial debacles in the postindustrial period. Examining the role of white-collar crime in past major financial debacles, such as the savings and loan crisis, provides insight into underlying structural factors that allow for crime-facilitative environments to develop, as well as a criminological context for analyzing the current financial meltdown. To prevent mortgage origination fraud effectively, one must first understand the crime-facilitative environment that naturally led to such practices and, thus, consider strategies that address problematic lending policies and practices in general.