BALTIMORE, MD (Tuesday, November 18, 2025) - Today, Mayor Brandon M. Scott announced that he is directing the Baltimore City Law Department in partnership with the City's Office of Equity and Civil Rights to open an investigation into possible violations of the Fair Housing Act by investors behind a recent fraudulent mortgage scheme that has led to a number of foreclosures in Baltimore City. As noted in recent public reporting, a small number of out-of-state investors whose fraudulent schemes, such as the misuse of debt service coverage ratio (DSCR) loans, has left many Baltimore residents at risk due to foreclosure actions on the properties in the investors' portfolio.

The Baltimore City Department of Housing and Community Development (DHCD) first identified the risks driven by these bad actors in the market beginning in June 2025 and has subsequently conducted a comprehensive analysis of the impacted properties across the city, identifying properties that currently have a Vacant Building Notice (VBN), code violations, or other risk indicators.

"Protecting Baltimoreans is my number one job as Mayor, and that means going after anyone who tries to defraud our residents - especially from outside of the city," said Mayor Brandon M. Scott. "In addition to the analysis done by DHCD, I've now directed our Law Department to open an investigation, and we're taking a close look at how the City can support investigations that are already underway. If we find individuals have broken the Fair Housing Act, we will hold them accountable for the damage they have caused."

"Baltimore has made tremendous progress in addressing its vacant housing crisis. But let me be very clear: when tools and products that were meant to help communities overcome the legacy of redlining are twisted into vehicles for personal greed and fraudulent gain, that will not go unnoticed," said City Solicitor Ebony Thompson. "If you try to get rich by targeting our residents and abusing programs designed to repair historic harm, we are going to use every legal resource available to hold you accountable."

"As Baltimore's Chief Equity Officer, I could not help but notice when looking at the map of foreclosures, they were overwhelmingly located in the Black Butterfly," said Director of the Office of Equity and Civil Right Amber Greene. "This is a pattern that we've seen play out over and over, whether it is through redlining or a fraudulent lending scheme, it is always our Black residents that suffer. I am proud to stand with the Mayor and the Solicitor to say we are going to fight back."

The Fair Housing Act prohibits discrimination in housing on the basis of race. The overwhelming majority of these properties are located in the Black Butterfly, the predominantly Black neighborhoods in East and West Baltimore. As a preliminary measure, the City will be filing actions to collect on thousands of dollars in unpaid taxes and liens by the property owners. However, the City will ultimately be investigating to determine if there are grounds for a Fair Housing Act action against the investors.