Mortgage fraud explained and how to make sure you’re not committing it

The recent allegations of mortgage fraud against Federal Reserve governor Lisa Cook have brought this rare financial crime into the spotlight.

Most types of financial fraud are relatively straightforward: the fraudster uses creative accounting, inflated numbers, or out-and-out lies to trick their victim into handing over money or valuables they wouldn’t otherwise part with, usually while twirling a villainous mustache. You can probably think of a dozen examples off the top of your head, from Bernie Madoff’s Ponzi scheme to the phone scams that try to convince your Nana her Social Security benefits are in danger. But until allegations were recently brought against Federal Reserve governor Lisa Cook, most people had never heard of mortgage fraud—and for good reason.