PROTECTING OUR FINANCIAL INSTITUTIONS
CID Exec Chris Swecker Talks About Frauds Committed Against Banks

09/22/04

Last week, the FBI went public with "Operation Continued Action"--a national takedown of organized groups and individuals targeting U.S. financial institutions. They could have gotten away with billions of dollars and threatened the nation's economy. Instead--with our law enforcement and regulatory partners--we've identified more than 271 subjects in 158 separate investigations worked by 47 field offices in 37 states. And we've filed more than 151 indictments, informations, and complaints so far. Read on as FBI Assistant Director Chris Swecker talks about the Bureau's continuing role in combatting these kinds of crimes.

Q. Can you tell me why the Bureau went public with "Operation Continued Action" last week?
A. Three words: protect the public. We want to educate consumers about these kinds of crimes, to let them know that if it's sounds too good to be true, it probably is.

We also think these arrests deter wannabe white collar crime criminals--people who aren't criminals, but could be fatally tempted by the prospect of making a lot of money so fast.

Q. Specifically, what kinds of cases were involved in "Operation Continued Action"?
A. A whole range of schemes. Like major mortgage and loan fraud. Identify theft. Financial institution failures. Check fraud and check kiting. And insider fraud. We focus on dismantling organized fraud rings, but we also go after individuals who are engaging in major frauds. We focus our resources where they'll make the most difference and the most savings to the economy.

Q. Two major FBI initiatives involve mortgage fraud and identify theft--can you talk a little about each of them?
A. Sure. Mortgage fraud really took off a couple of years ago when interest rates began dropping and there was a run on refinancings. The problem continues to escalate, but we're working to get out in front of it. By its nature, mortgage fraud needs "insider" involvement, so we're finding that undercover operations are highly effective in uncovering them. We're also working closely with all the industry's professionals--mortgage brokers, realtors, accountants, appraisers, loan officers, and title companies--who are as anxious as us to weed out the bad seeds.

As for identity fraud, we want and need the public's help in reporting these crimes. Individual reports, though, are not enough. To get our arms around the problem, we need to consolidate all the reports in one place and analyze them to see the patterns, the trends, the culprits. That's why we're currently working with several banks, credit card issuers, law enforcement, and regulatory agencies to establish a National Joint Identity Theft Center, where analysts would link violations, identify rings perpetrating the acts, and get that information to the right law enforcement agency for appropriate action.

Q. Can you tell me the numbers? How successful have you been?
A. I'd say very successful. Since 2000, our investigations have resulted in nearly 11,500 indictments, almost the same number of convictions, and approximately $8.1 billion in restitution orders. And during fiscal year 2004 alone, we've managed to completely dismantle more than 18 organized groups involved and disrupted the activities of about 33 more.