A national effort to crack down on mortgage fraud schemes has snagged a pair of Utahns.

The U.S. Department of Justice and FBI's Operation Malicious Mortgage program led to federal grand-jury indictments for Jerry C. Huff , 49, of Hurricane, and Bryan D. Conrad, 37, of Salt Lake City. The indictments, announced Thursday, were returned last week, and summons will be issued for both to appear for arraignment in federal court.

Since March 1, Operation Malicious Mortgage has resulted in 144 mortgage fraud cases, in which 406 defendants were charged.

Sixty arrests were made Wednesday in mortgage fraud-related cases. The FBI estimates that about $1 billion in losses were inflicted by the mortgage-fraud schemes.

"There is a tremendous amount of effort that is being expended on the part of state, local and federal investigators to root out mortgage fraud (and) insidious lending industries and hopefully restore confidence in a sagging and difficult market in the housing industry right now," U.S. Attorney Brett L. Tolman said Thursday at a news conference in Salt Lake City.

Tolman characterized the Utah cases as relatively "small" but noted that "you're neither too small nor too large for these types of investigations."

The FBI has established 38 task forces nationally to fight mortgage fraud. FBI Special Agent in Charge Timothy J. Fuhrman said Thursday that the bureau has 1,380 open investigations nationally, including 31 in Utah.

All mortgage-fraud cases involve a scheme with a material misrepresentation by people to obtain a load fraudulently and at a loss to lending agencies, he said.

Conrad is charged with bank fraud and aggravated identity theft in a scheme to get money or property from financial institutions by falsely using the identities of other people. The two counts of bank fraud carry a penalty of up to 30 years in federal prison per count and a $1 million fine. Aggravated identity theft has a two year-mandatory minimum sentence.

Huff is charged in a five-count indictment with wire fraud, money laundering and failure to file a federal tax return. He used several methods to get a $250,000 second mortgage on his Moab home, according to the indictment. Among the methods were submitting a loan-application package that contained false information about his personal income and the ability to repay the second mortgage. He also is accused of submitting a fictitious house appraisal and giving the false impression that he had filed tax returns in 2001 and 2002, when he actually did not file returns.

Huff is charged with one count of wire fraud, which carries a maximum penalty of 20 years in federal prison; two counts of money laundering with potential maximum penalties of 10 years in prison per count; and two counts of failure to file a tax return, which carries a maximum penalty of one year in prison per count.

"It's that sort of behavior," Tolman said, "that is rampant across many states across this country, and I'm here to send a message to those that are engaged in it: We are aware of many of you, and we are aware every day of more of you, and we will prosecute vigorously in both the state and federal system. It is not something that's going to go away just because we see improvement in the market."

The IRS is among nine federal agencies lending resources to the crackdown. "We feel that mortgage fraud, like all financial crimes, erodes the integrity of our tax system, and it threatens the financial health of our community," said Mike Brock, supervisory special agent with the IRS Criminal Investigations Division in Salt Lake City.

Across the nation, reports of mortgage fraud have soared over the past year, as the subprime mortgage market collapsed and defaults and foreclosures soared.

"Mortgage fraud and related securities fraud pose a significant threat to our economy, to the stability of our nation's housing market and to the peace of mind to millions of Americans," Deputy Attorney General Mark Filip said in a statement Thursday.

Banks reported nearly 53,000 cases of suspected mortgage fraud last year, up from more than 37,000 a year earlier and about 10 times the level of reports in 2001 and 2002, according to the Treasury Department's Financial Crimes Enforcement Network.

The most common type of mortgage fraud was misstatement of income or assets, followed by forged documents, inflated appraisals and misrepresentation of a buyer's intent to occupy a property as a primary residence.

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