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Schuette Announces Support for Proposed Legislative Reforms to Help Prosecutors, Law Enforcement Combat Mortgage Fraud

Contact: John Sellek or Joy Yearout 517-373-8060

May 6,  2011

            LANSING Attorney General Bill Schuette today announced his support for proposed legislative reforms intended to strengthen the hand of prosecutors and law enforcement to combat mortgage fraud.  Schuette joins State Senator James Marleau (R-Lake Orion), Secretary of State Ruth Johnson and Oakland County Register of Deeds Bill Bullard, who came together this morning to support legislative reforms in light of recent allegations of fraudulent mortgage documents filed in Michigan.   

"Michigan homeowners deserve every possible legal protection against the devastating effects of mortgage fraud," said Schuette.  "I welcome reforms that will give prosecutors and law enforcement the tools they need to crack down on mortgage fraud and protect homeowners."

A bi-partisan package of bills introduced in the Michigan Senate will change Michigan law to better confront the devastating affects of mortgage fraud, including:

·    Senate Bill 252, sponsored by Senator James Marleau (R-Rochester), which increases the penalty for violations of the notary act when a document affects interest in real estate from a misdemeanor to a four year felony;

·    Senate Bill 253, sponsored by Senator John Gleason (D-Flushing), which amends sentencing guidelines to reflect the new felony penalty for notary violations related to real estate;

·     Senate Bills 249 and 250, sponsored by Senator Darwin Booher (R-Evart), which increase the penalties for the crime of false pretenses (fraud) over $20,000;

·     Senate Bill 251, sponsored by Senator Mike Nofs (R-Battle Creek), which increases the statute of limitations from six to ten years for crimes related to real property transactions.  This will allow extra time for investigators, especially in cases when the crime is not revealed until years after the transaction is completed; and,

·     Senate Bills 43 and 44, sponsored by Senator Tupac Hunter (D-Detroit), which define the specific crime of "Mortgage Fraud," giving prosecutors a more precise tool to prosecute offenders.

The Michigan Attorney General's office has played an aggressive role in prosecuting individuals and companies for mortgage-related crimes cross the state.  Schuette has spoken with registers of deeds across the state and has initiated an investigation in response to their concerns that thousands of forged mortgage documents were filed in Michigan during the current foreclosure crisis.  Schuette is also working with fellow attorneys general in a national workgroup examining mortgage lending practices, including the robo-signing issue and consumer protection concerns. 

Schuette reminds Michigan homeowners that citizens do not need to pay to speak with their lender or servicer, or to obtain outside assistance with foreclosure issues.  Free local assistance with foreclosure issues can be found by calling the Michigan State Housing Development Authority at (866) 946-7432.

Schuette noted that Michigan's Credit Services Protection Act prohibits the charging of upfront fees for mortgage services.  Schuette urges any consumers who paid upfront fees to an individual or mortgage modification company for services that were not provided to file a consumer complaint online with the Attorney General's Consumer Protection Division online at



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