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A report released this week by the Federal Bureau of Investigation found that Minnesota ranked in the top fifteen states for mortgage fraud claims in 2008 and in the top ten on a couple of measure. Specifically, data from the Financial Crimes Enforcement Network found Minneapolis FBI field offices ranked 9th in the number of Suspicious Activity Reports (SARs) related to mortgage fraud. And data from Fannie Mae’s reviews of mortgage loan “misrepresentations” put Minnesota at 7th in total fraud cases out of the 50 states.

A combination of aggregate data from eight different mortgage fraud tracking organizations put Minnesota at 13th overall for mortgage fraud. The top 15 states were California, Florida, Georgia, Illinois, Michigan, Arizona, Texas, Maryland, Missouri, New Jersey, New York, Ohio, Colorado, Nevada, Minnesota, Rhode Island, the District of Columbia and Massachusetts.

The FBI report said that fraud cases increased in 2008 as mortgage lenders tried to maintain their “high standard of living” following the disastrous collapse of housing bubble.

Mortgage fraud trends in 2008 reflected the overall downturn in the US economy … the mortgage loan industry reported a spike in foreclosures and defaults; and financial markets continued to contract, diminishing credit to financial institutions, businesses, and homeowners. These combined factors uncovered and fueled a rampant mortgage fraud climate fraught with opportunistic participants desperate to maintain or increase their current standard of living. Industry employees sought to maintain the high standard of living they enjoyed during the boom years of the real estate market and overextended mortgage holders were often desperate to reduce or eliminate their bloated mortgage payments.

Remember the second questioner from the second presidential debate? His name was Oliver Clark. Remember how John McCain answered Clark’s bailout question? He said lots of things, but you’ll remember this zinger: “The match that lit this fire was Fannie Mae and Freddie Mac. I’ll betcha you may never have even heard of them before this crisis.”

Remember how Clark smiled at that? It turns out Clark gets the last word in that exchange–on his Facebook page. He talks about the whole experience and he’s hilarious. But the best part is his response to McCain’s Fannie and Freddie quip.

Well Senator, I actually did. I like to think of myself as a fairly intelligent person. I have a bachelor degree in Political Science from Tennessee State, so I try to keep myself up to date with current affairs. I have a Master degree in Legal Studies from Southern Illinois University, a few years in law school, and I am currently pursuing a Master in Public Administration from the University of Memphis. In defense of the Senator from Arizona I would say he is an older guy, and may have made an underestimation of my age. Honest mistake. However, it could be because I am a young African-American male. Whatever the case may be it was somewhat condescending regardless of my age to make an assumption regarding whether I was knowledgeable about Fannie Mae and Freddie Mac.

Next time around maybe the audience should have the opportunity for follow up.

Economist and NYU professor Nouriel Roubini has repeatedly warned in papers and interviews that the financial and banking crisis will last several years, with credit losses nearing $2 trillion. Since late 2006, a total of 283 lenders have imploded, according to the Mortgage Lender Implode-o-Meter. The bloggers at Implode-o-Meter have been tracking the housing crisis and the fraud inherent in it that has contributed to the toppling of mortgage giants. Currently, 14 lenders are on Implode-o-Meter’s ailing list, including majors like Sallie Mae, Chevy Chase, and Residential Capital, a mortgage subsidiary of GMAC Financial.

The subprime fallout is leaving small banks unstable, too. According to LoanWorkout.org, a consumer-watchdog site, the Federal Deposit Insurance Corp (FDIC), the organization responsible for insuring up to $100,000 in individual bank accounts, might also look to the Treasury Department as its coffers begin to run dry as a result of bank failures and a shored-up cash flow. (Nearly ten percent of its reserves were swallowed up in the IndyMac bust.) Roubini estimates that hundreds of small banks will go bust in the next year, as the average bank has nearly 67 percent of its assets in real estate. The FDIC says it’s currently watching 117 in-danger-of-collapsing banks, which hold approximately $78 billion in assets.

So what do the bank collapses and an already $400 billion in government bailouts mean for you? In taxpayer payouts, we’re already more than 300 percent beyond the Savings and Loan scandal that cost taxpayers $124 billion in the 1980s. And according to Roubini, the current and looming fallouts mean we’re on the precipice of the most severe U.S. recession in decades. “This U.S. consumer is shopped out, saving less, debt burdened and being hammered by falling home prices, falling equity prices, falling jobs and incomes, rising inflation and rising oil and energy prices,” he writes on his blog, the Global EconoMeter.

Consumers shouldn’t expect a quick turnaround, he says. Instead, he adds this ominous forecast for America’s future: “This is the beginning of the decline of the American Empire.” The losses are spreading to industrial and corporate loans, to corporate bonds and CDs, Roubini says. Those collapses will lead to a systemic failure of the market, and America as a super power.

The losses also mean more tax dollars going to corporate welfare, that every person is a “shareholder” in seriously unstable companies Fannie Mae and Freddie Mac, and that the already swelling federal deficit just ballooned further. And it means that those responsible for the crisis, voracious executives and directors whose unstoppable appetite for profits caused the biggest financial crisis since the Great Depression, get off easy why the American public pays for their greed affair.

In honor of this Depression-era milestone, we look back at a MnIndy July article spelling out just how much the execs at Fannie Mae and Freddie Mac stood to gain on the backs of consumers, and what your hard-earned tax dollars will buy you today:

$13.4 million: Amount in salary and compensation paid to Fannie Mae CEO Donald Mudd in 2007, a 7 percent increase in pay from the year prior despite the fact that the company’s shares lost a third of their value in 2007

$18.9 million: The total amount, not including salary, compensation, and stock options, Freddie Mac CEO Richard Syron is eligible to receive through extension bonuses, “equity grants,” and “performance awards” if he stays through 2009

$12.77 million: The total amount in lobbying expenses paid by Freddie Mac in 2007

$3.3 million: The total amount in lobbying expenses Freddie Mac has paid so far in 2008

$12.3 million: The total amount in lobbying expenses paid by Fannie Mae in 2006

$1.8 million: The total amount in lobbying expenses Fannie Mae has paid so far in 2008

$29 billion: The amount of credit the Federal Reserve awarded to JPMorgan to buy ailing Bear Stearns in March of this year

$124.6 billion: Total paid by U.S. government in the early 1990s for the Savings and Loan scandal caused by fraud and unregulated and imprudent lending practices

747: Total number of savings and loan associations that failed as a result of the scandal

$165 million: Average amount needed to bail out each institution then

$35 billion: Average amount needed to bail out each ailing institution today

More on Fannie Mae and Freddie Mac here.

More on Nouriel Roubini here.