You should check your state's laws but in Florida, the title company makes sure to verify the seller's identity after we open escrow.

This type of classification is identical to that of a vehicle.

I get the old loan is paid off and the insurance goes with it but why can't it just be transferred to the new nearly-identical loan.

But by signing the document knowing full well that you're not planning to move to the property would be committing mortgage fraud.

It would be hard for them to get your money back (scammers avoid the Banks because their fraud departments have the ability to freeze funds and return funds once fraud is confirmed),  but the police will look into this.

Take identity theft..  

Recently, more states have adopted protections based upon sexual orientation and gender identity, for example.

They will grant a court order and the money will come out of his paycheck.Most folks that get prosecuted for tax fraud have a pissed off ex in the background who provides the IRS with enough info to go after them. 

I didn't know Ross Hamilton was selling a fraud product.

In terms of mortgage fraud, I'm not a lender or lawyer but the language typically says that you got this loan with the "intent" to move in.