On one loan, for example, the borrower's previous address turned out to be nonexistent. On another, the borrower submitted two bank statements. The first month's closing balance didn't match the second month's opening balance, an indication that the documents might have been faked. A third borrower overstated his income, a fourth his assets.
National City acknowledged errors in seven loans but said its default rate was below the industry average.
Suspicious-activity reports can be triggered in a variety of ways. Fraud is sometimes uncovered by lenders in quality-control spot checks or by an inquiry that comes after a borrower quits making payments.
If the lender can identify a suspect, it is required to report fraud of as little as $5,000. If no suspect can be identified, the floor is $25,000.
But only lenders that also operate as banks are required to file suspicious-activity reports with the FBI. That's a growing number of lenders -- another reason reports might be increasing -- but banks still account for fewer than half of all mortgage loans. Independent mortgage brokers, which arrange loans but do not fund them, are not required to file reports.
The FBI's Los Angeles region includes reports of suspicious activity in the counties of Los Angeles, Orange, Riverside, San Bernardino, San Luis Obispo, Santa Barbara and Ventura. But prosecutors here say few cases are referred to them, and even fewer are pursued.
The FBI, preoccupied with counterterrorism, says such cases generally aren't worth pursuing.
"We act on the ones that are the most egregious and involve the most loss to the lender," said supervisory special agent Peter Norell, who coordinates the FBI's white-collar-crime program in Los Angeles.
The tiny minority of cases that do result in arrests and trials tend to involve rings of professional criminals.
In one popular scheme to defraud lenders, one ring member acquires a property, gets it appraised by a confederate for twice its value, and then sells it to a third accomplice at the inflated price.
The accomplice immediately defaults on the loan -- netting the ring a quick payday on the sale and leaving the bank stuck with more debt than equity.
Then there are cases of outright theft. Kenneth C. Ketner, who ran a Newport Beach mortgage company, pleaded guilty last month to diverting about $9 million in borrowers' funds. Prosecutors said he used some of his loot for a $244,000 Ferrari.
FBI statistics show that Southern California has the most reports of mortgage fraud in the country, topping those of the Atlanta, Chicago and Miami regions. But the number of cases investigated by the FBI here has been falling relative to those of other urban areas.
In 2004, the bureau said, the Southern California region was tied for second in the number of cases opened. Last year it fell to a tie for seventh.
"Resources are doled out based on priority," said the FBI's Heilig. "White-collar crime is ranked No. 7." Shortly after she was interviewed, Heilig herself switched from mortgage fraud to the FBI's No. 1 priority, counterterrorism.