With the economic crisis unrelenting, the United States is stepping up its fight against white collar crime, which has been trumped by the fight on terror.

"Let’s give our law enforcement agencies the tools and resources they need, said Senator Patrick Leahy, Chairman of the Senate Judiciary Committee, at a a hearing Wednesday.

"All the ordinary Americans who have suffered the brunt of this (economic crisis) want to know that we’re doing everything possible" to combat white collar crime, he added.

In the most sensational case of its kind in years, former Nasdaq stock exchange chairman Bernard Madoff was arrested in early December after allegedly confessing to his two sons and to the FBI that he had run a 50-billion-dollar pyramid fraud known as a Ponzi scheme.

Investors caught in Madoff’s alleged fraud include Hollywood celebrities, charities, universities, and major financial institutions including UBS, HSBC, JP Morgan Chase, BNP Paribas and Citigroup.

Over the past few years, the FBI has been steadily beefing up its teams fighting white collar crime — fraud and corruption that has had disastrous consequences for families and the balance of the financial system.

"After 9/11, we moved almost 2,000 criminal investigative resources over to national security matters, particularly counter-terrorism," FBI Deputy Director John Pistole told Leahy’s committee.

"We have been gradually moving those back. And have done that in terms of priority areas, such as this mortgage fraud and the corporate fraud area which is potentially as significant in terms of long-term complex investigations."

But since 2005, investigations by the federal law enforcement agency on real estate fraud has almost tripled, from 721 cases in 2005 to 1,800 cases currently being investigated, according to Pistole.

"And of course, we expect an upward trend to continue," he warned.

Corporate fraud and corruption cases number 530, 38 of which are directly tied to the mortgage industry, such as US mortgage finance giants Fannie Mae and Freddie Mac.

A surge in foreclosures took place following the collapse of the housing market in 2006 and the related subprime mortgage crisis that triggered the financial crisis in August 2007.

Leahy, a Democrat, has introduced legislation with Republican Senator Charles Grassley and Democratic Senator Ted Kaufman to assist the federal government in investigating and prosecuting financial fraud.

"I want to make sure that we’re able to go after them. And I want to make sure that we can recover whatever assets we can. But I want to see people prosecuted," Leahy said.

But the challenge is mostly tied to available resources — in terms of staff and finances — with financial investigations as complex as those involving organized crime or drug trafficking.

"The primary near-term security concern of the United States is the global economic crisis and its geopolitical implications," National Intelligence Director Dennis Blair told a Senate panel Thursday.

In the aftermath of the September 11, 2001 attacks, terrorism had been cited as the top US security concern.

The FBI now has 240 agents assigned to mortgage fraud and related investigations, with over 100 more agents working on corporate fraud matters, Pistole said. The agency also sponsors 55 mortgage fraud task forces or working groups across the country.

But some lawmakers expressed concern that more still needs to be done to address the rising problem of mortgage and corporate fraud.

"Mr Pistole, clearly, you don’t have enough FBI agents," Kaufman said.

"Now, we’ve done a scrub of all our criminal investigative resources," Pistole acknowledged.

Between 1986 and 1995, during the savings and loans crisis, the FBI assigned some 1,000 agents, in addition to financial and other analysts, through a series of 27 strike forces across the United States, Pistole said. Dozens of federal prosecutors were also engaged in legal proceedings.

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