I don’t think there is anything dirty or crooked about someone allowing their home to go into foreclosure, even if they can afford the payments, because the value has dropped dramatically. It’s probably not a good strategy for someone who re-fied, but for someone with 80/20 non-recourse purchase money it may make sense. The mortgage contract is pretty simple – the buyer agrees to make payments as described, and if they don’t the lender(s) take the collateral. That was the deal. If the poor 2nd gets wiped out, oh well, that’s show business. That’s what you risk when you go 100% ltv as a lender. You don’t want the risk, don’t lend the money.

Forging rental agreements and fake escrows are a whole different story. Such activity is dirty and crooked and fraudulent, and there is probably going to be plenty of it.
But what can you expect when there are potentially hundreds of thousands of dollars at stake? The way I see it, if otherwise straight people were inclined to fib on the stated income deals that got them into trouble in the first place, they will probably be willing to do the same again to get out of the old deal and into a new one.