The FBI put the losses to homeowners and other borrowers who were victims in the schemes at over $1 billion.
"Mortgage fraud poses a significant threat to our economy, to the stability of our nation's housing markets and to the peace of mind of millions of American homeowners," Deputy Attorney General Mark Filip said at an afternoon news conference.
Sixty people were arrested Wednesday as part of the three-month sting, dubbed "Operation Malicious Mortgage," reports CBS News producer Robert Hendin. People arrested include buyers, sellers and others across the wide-ranging mortgage industry. The take down focused primarily on lending fraud, foreclosure rescue scams and mortgage-related bankruptcy schemes.
Since March 1, 406 people have been arrested in the sting resulting from 144 cases across the country, including those in Chicago, Miami, Houston and a dozen other regions policed by the FBI.
Law enforcement officials said their stepped-up focus on mortgage cases aims to combat problems that have grown out of the risky lending practices prevalent until the mortgage market collapse started last year. Officials have identified 10 "mortgage fraud hotspots" nationwide in California, Colorado, Texas, Minnesota, Michigan, Illinois, Ohio, New York, Georgia and Florida.
Seven people in Atlanta are charged with taking out $150,000 loans on $30,000 condos, reports CBS News correspondent Bob Orr; a Miami couple is accused of using phony loans to pocket nearly $8 million; and in Baltimore, four people are charged with bilking millions from struggling homeowners who tried to buy "protection" from foreclosure.
To people who have committed fraud or are contemplating doing so, FBI Director Robert Mueller said: "We will find you, you will be investigated and you will be prosecuted."
Those named in the cases include housing developers, mortgage lenders and brokers, lawyers, real estate agents and appraisers, said Sharon Ormsby, section chief in charge of financial crimes for the FBI.
In some cases, gang, drug and organized crime investigations have resulted in mortgage fraud cases because such schemes enable criminals to launder money, Ormsby said.
Mortgage foreclosure rescue scams, which promise to help struggling homeowners stave off foreclosure and keep their homes, also have become a major problem, officials said. Typically, unsuspecting owners sign over their homes and then find they are victims of fraud.
In separate arrests,Thursday, becoming the first executives to face criminal charges related to the collapse of the subprime mortgage market.
Across the country, reports of mortgage fraud have soared over the past year as the subprime mortgage market collapsed, and defaults and foreclosures soared.
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.
In recent months, the FBI has been investigating more than 1,400 mortgage fraud cases and 19 companies - including Bear Stearns - tied to the subprime mortgage crisis. The number of agents assigned to mortgage-related crimes has jumped 50 percent in the last year to 180, reports CBS' Orr.
Officials declined to say who might be the next corporate target, but Mueller said the investigations focus on accounting fraud, insider trading, and failure to disclose the value of mortgage-related securities and other investments.
Under review for potential fraud are: investment banks, hedge funds, credit rating agencies, brokerage houses and due diligence firms - which evaluate loans packaged into investments.
Similar to the federal investigations of Enron Corp. and WorldCom Inc., the cases are complex and rely on intense scrutiny of documents, Mueller said.