Former prosecutor Anthony Accetta cleaned up mortgage fraud 34 years ago - or at least, he tried.

In 1972, as an assistant U.S. attorney in New York state, Accetta prosecuted rampant mortgage fraud. Subsequent trials convicted 70 people and companies. Even the regional director of the Federal Housing Administration went to prison.

"We closed down nine mortgage banks," Accetta said. "Presidents of various mortgage companies went to jail, mortgage brokers and credit analysts went to jail, lawyers and accountants - they all went to jail. The whole system was corrupt."

Accetta even filed criminal charges against Dun & Bradstreet for aiding and abetting. That trial resulted in a hung jury, although the giant credit-ratings agency settled civil charges with the Justice Department, Accetta said.

Today, Accetta is a private fraud investigator based in Colorado. When he read The Denver Post on Thursday, he was reminded that not much has changed in the mortgage business, particularly in this state, which has posted the highest foreclosure rate in the nation for five months.

"A key factor in the state's record-setting wave of foreclosures, critics say, is an FHA program that allows people to borrow more than their houses are worth with little or no money down," Post reporters David Olinger and Jeffrey A. Roberts wrote. And in the past two years, the foreclosure rate on FHA-insured loans has nearly doubled, they reported.

Accetta - who recently investigated a mortgage-fraud ring in New York - said he believes the mortgage brokers are so interested in making loans that they often encourage homebuyers to lie on loan applications.

"If I were a prosecutor, I'd clamp down on every mortgage bank in this city," Ac cetta said. "I would have them before a grand jury. The bad ones I'd put in jail, and the rest of them would be subject to a permanent monitoring program."

Accetta said nobody in the lending industry cares about mortgage fraud, because nobody in the lending industry suffers when a loan goes bad. The mortgage industry is a financial game where all of the players are covered against losses.

Mortgage brokers close loans, bag fees and move on. Lenders then sell the loans to investment banks, which bundle them with hundreds of millions of dollars' worth of other loans and sell them to investors. The investors who buy these bundles are not on the hook, either. That's because the investment banksthey buy them from will replace bad loans with performing loans to preserve values.