Mortgage fraud is rising nationally and remains more active in Nevada than in almost every other state, a new report shows.
Some 74 percent of U.S. home loans last year involved some kind of fraud or misrepresentation on the application, up from 69 percent in 2012 and 61 percent in 2011, according to LexisNexis Risk Solutions.
The most notable jump, the report said, was in fraudulent or misleading credit documentation, with 17 percent of loans investigated for that, up from 5 percent in 2012.
However, reported fraud on appraisals and property valuations fell to a five-year low in 2013 to 15 percent of loans. That’s down from 31 percent in 2009.
Overall, Nevada had the second-highest rate of mortgage fraud last year, according to LexisNexis. The company gave Nevada a mortgage fraud index tally of 221, meaning its rate of fraud was more than twice the expected rate, based on loan-origination volume.
Nevada has held the No. 2 ranking since 2010.
Florida had a tally of 529 last year, meaning its rate of fraud was more than five times what would be expected. Florida has held the dubious No. 1 spot since at least 2009.
Recent cases in Southern Nevada include:
• Derrick and Cynthia Phelps, a married couple from Texas who owned mortgage businesses in Henderson, were sentenced to prison Dec. 2 in connection with mortgage fraud and ordered to pay about $31 million in restitution. Both pleaded guilty in April to one count of conspiracy to commit bank fraud and seven counts of bank fraud. Derrick Phelps got 70 months in prison, and Cynthia Phelps got four years.
• Alex Soria and Sonia Rodis of Las Vegas pleaded guilty Nov. 3 to one count each of a pattern of mortgage-lending fraud. They both face three to 20 years in prison and a fine of up to $50,000, according to their plea agreements. They will also have to pay restitution to victims.
• Jabari Marshall of Las Vegas was sentenced to 20 years in prison on April 10 for his alleged role in trying to steal proceeds from $35 million in mortgage loans. A jury had convicted him in September 2013 of conspiracy to commit mail and wire fraud.