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Hundreds of solicitors may be on the verge of being investigated as mortgage fraud increases, the Solicitors Regulation Authority has claimed.

There were 85 cases of suspected mortgage fraud in 2004, increasing to 105 in 2005, 215 in 2006 and 293 in 2007, according to the authority's figures.

It added that some solicitors are failing to warn lenders about suspicious transactions.

According to the Solicitors Regulation Authority, the secret discounting of sale prices on newbuild properties is a cause for concern, particularly because the sale price before discounts is then registered with Land Registry which could skew property values.

Lesley Miller, communications officer for the Solicitors Regulation Authority, said: "We are continuing to work with cases which take a long time, during which the number of lawyers under investigation is going to fluctuate. However, I am not in a position to confirm the number of solicitors under investigation with relation to this currently."

Bernard Clarke, communications manager for Council of Mortgage Lenders, said attempted fraud could manifest in a number of different ways and confirmed it was working with the FSA to tackle it.

He said: "It is in lenders' interest to be vigilant and information sharing between lenders has helped reduce it. One of the areas there has been an increase of fraud has been on the value of newly built properties. The problem is that the valuation process has not captured the true value of the property. Some of it could be fraudulent and some of it may be an oversight."