Feds move on mortgage scam crack-down.

Saying that there are too many firms taking advantage of financially vulnerable individuals, the Obama administration recently announced it would redouble its efforts to combat fraudulent practices among companies offering to help consumers avoid foreclosure.

The initiative will include additional criminal and civil prosecutions and an effort to alert financial institutions about fraudulent schemes and suspicious companies.

The program will be a joint effort of the Housing and Urban Development, Justice and Treasury departments, the Federal Trade Commission and the states' attorneys general.

The Treasury Department is alerting financial institutions of emerging schemes in this area. The Financial Crimes Enforcement Network sent out a memo urging financial institutions to conduct customer due diligence on a risk-based basis to identify potentially suspicious transactions. When they detect suspicious activities, they should file a Suspicious Activity Report and should include the phrase "foreclosure rescue scam," in the narrative part of the report.

If a homeowner reports to a financial institution that they have hired a third party to help them, potential signs of a scam include: charging up-front fees; aggressively pursuing a customer; and guarantees to save the home "no matter what."

In addition, the Justice Department will increase prosecutions both against companies that are targeting practitioners of loan modification or foreclosure rescue scams.