borrower in may of 2009 got refinance on property now in short sale with no job or income had falsefied papers is this mortgasge fraud
Well, it sounds like fraud. I'm not sure of the distinction you are trying to make between the mortgage and the bank? If the borrower falsified his/her own documents, then it is known as "fraud for housing" - meaning, the buyer lied in order to obtain a home and a mortgage for which he/she should not have been qualified. If the mortgage originator or other professionals (who might have been a mortgage lender, a bank employee, a mortgage broker, an appraiser, an attorney, a real estate agent) falsified the documents FOR the buyer, without the borrower knowing about it (rarer, but it does happen), so that he/she could make a profit by writing the mortgage or selling the house, it is known as "fraud for profit" - also known as insider fraud, as it is perpetrated by a lending professional for personal or company gain.
I suppose you could further classify it by what sort of mortgage outfit originated, underwrote, and funded the loan . . . but that isnt clear from the question. Any way you look at it, though - the person that lied committed fraud. A lender that should have reasonably suspected that the information was a lie, or didnt actively verify the borrower's ability to repay the loan, as they should have, could also be accused.