Mortgage fraud.

Existing law provides that a person, other than the loan applicant, who makes false financial statements in connection with an application for a loan to be secured by real property is guilty of a misdemeanor, punishable by a fine not exceeding $10,000, by imprisonment in a county jail not exceeding one year, or by both the fine and imprisonment; and by restitution to the victim, as specified. This bill would delete this provision and provide instead for the offense of mortgage fraud, as defined, a violation of which would be a public offense punishable by imprisonment in the state prison or in a county jail for not more than one year. The bill would provide that mortgage fraud may only be prosecuted when the value of the alleged fraud meets the threshold for grand theft, as specified. The bill would set forth legislative findings, declarations, and intent with respect to its enactment. By revising existing crimes and creating new crimes, this bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.