By the Division of Banks

In April 2008, the Division created an Investigation and Enforcement Unit to supervise fraud investigations of the Division's regulated entities. This Section interacts regularly with several state and federal law enforcement agencies, including the Office of the Massachusetts Attorney General, the United States Attorneys' Office, the Federal Bureau of Investigation, the United States Marshal's Office, and the Internal Revenue Service.

The Unit was created in part as a response to the increased number of cease-and-desist orders the Division issues to licensed mortgage lenders and brokers that are found to be operating in an unsound manner. Since 2006, when the Division became the first regulator in the country to issue cease-and-desist orders to licensed mortgage lenders and brokers found to be falsifying borrower information, the Division has issued over 230 informal and over 150 formal enforcement actions against licensed mortgage lenders and brokers. In addition, in September 2006, the Division revised its mortgage lender and mortgage broker examination procedures to eliminate scheduled examinations in favor of surprise examinations. Further, the Division's compliance-based examination was replaced with a fraud-based model. New techniques include a review of the performance of loan transactions and attending loan closings on an unannounced basis. The increased number of enforcement actions combined with the fraud-based examination model resulted in a need for a separate enforcement unit. This Section also regularly refers cases to law enforcement agencies to determine whether criminal penalties are warranted.