When you take a property that's approved for ten building sites and tell the bank they're more valuable than they really are... that's a stretch. When you tell the bank it's approved for thirty lots, that's fraud.
When you take a luxury property that's deed restricted to one residence and tell the bank you can develop it into 12 estates, that's fraud.
When you say your 11,000 square foot apartment is 33,000 square feet... that's fraud.
These are some random examples. Mr. Wonderful can say, "Everyone does it," til he's blue in the face. It's fraud.