Lost Wallet's ID Cards Spawned Mortgage Fraud

"It's affected me," Lara said. "Sometimes I have headaches, a lot of stress," and he missed time from work dealing with the case. Not long after he got the check, for overpayment of closing costs, he started getting monthly statements. "When you get a bill that's not yours, it's frustrating," he said.

Land records indicate that Cabrera-Rivera used Lara's identity three times in three counties. The first time was in September, when WestStar Mortgage Inc. in Woodbridge approved a first mortgage for $335,200 and a second mortgage for $83,800. The mortgages covered the entire cost of the townhouse on Westbury Oaks Court, near Old Keene Mill Road in Springfield.

Officials from WestStar did not respond to phone and e-mail messages yesterday.

Next, in early November, Cabrera-Rivera obtained a gift deed, in which her brother, posing as Lara, signed the house over to her. Court records indicate that the deed was prepared by a Fairfax lawyer, Rocco J. DeLeonardis. He did not return calls yesterday.

Also that month, Cabrera-Rivera and her brother went to a BB&T bank branch in Arlington and applied for a $90,000 loan to refinance her second mortgage, Wilson said. That was approved, too, but BB&T apparently overestimated the closing costs, so it sent a check to the real Jose Lara, who sparked the investigation by returning the check.

BB&T would not comment because the case is pending, a corporate spokeswoman said yesterday.

BB&T called Arlington police and arranged for Cabrera-Rivera to come in to a branch to fill out more forms, and she brought along her husband to pose as Lara, Wilson said. Both were arrested. Her husband, Lorenzo Castro, awaits trial on misdemeanor charges.

"That's kind of unusual," said William J. Kresse, a professor who has studied identity fraud. "Usually the thieves want to get their hands on cash, not real estate. And it's unusual in that they made the payments."

Kresse, a professor at Saint Xavier University in Chicago, compiled data from nearly 29,000 identity theft cases in Chicago between 2000 and 2006. He discovered that low-income people are victimized disproportionately, that 60 percent of the identity thefts were committed by a friend or relative of the victim, and that the Internet was used to steal identities in less than 5 percent of cases.

Burglaries, robberies and pickpocketing lead to most identity theft cases, Kresse said. Chicago police are now distributing pamphlets to victims of such crimes, telling them to prepare for possible identity theft.

"The mortgage brokers are really the people who should be looked at," said Salvado, arguing that lenders helped create the situation. "Somewhere in the U.S., a dog has gotten a loan."

Officials with the Virginia Association of Mortgage Brokers did not return calls. The federal Financial Crimes Enforcement Network reported last year that as many as two-thirds of mortgages are now arranged by mortgage brokers and that there are no national standards for licensing and oversight of mortgage brokers.

WestStar, which financed the first and second mortgages on the Springfield townhouse for $419,000 at 7.125 percent interest, advertises on its Web site "no documentation loans" in which "you can avoid the need to verify your income."