Most insiders knew this sort of thing was happening during the golden days of the last real estate boom. In most towns around the country, it was easy to find brokers and closing service providers that "could get anybody a loan." How did they do it? Usually by lying about the borrower's income, assets, identity and credit history, the value of the property securing the loan, and so on. This kind of fraud is a significant reason (but clearly not the only reason) for the troubles many lenders currently face.

Now that the housing and lending markets are in the midst of a long term "correction," some lenders are going after those brokers and other service providers that helped or convinced borrowers to lie to lenders and get into bad loans, with the help of prosecutors.

In this Fulton County Daily Report article, there is a detailed description of the activities of a Georgia lawyer who participated in a scheme that cost lenders at least $20 million.

If any of the techniques described in the article sound familiar to you readers, or if you participated in a transaction that used some of the described methods, take heed: Georgia isn't the only place where federal prosecutors are likely to investigate and prosecute.