Fraud and Prevention

First American CoreLogic Intros New Fraud Prevention Services

By James Comtois
October 21, 2009

First American CoreLogic, a Santa Ana, Calif.-based provider of property and ownership information, analytics and services, released three new fraud prevention services.

The new services, which were unveiled at the Mortgage Bankers Association's annual convention in San Diego last week, are a new fraud prevention tool, a free property information service for homeowners and a national fraud data repository.

First American CoreLogic's fraud prevention tool, LoanSafe Fraud Manager, integrates recently acquired BasePoint Analytics' pattern-recognition technology with First American CoreLogic's comprehensive property, loan and mortgage fraud database. LoanSafe scores fraud risk on a 1-to-999 scale and offers a series of alerts to prompt underwriters to provide additional reviews.

These alerts include undisclosed debt indications, multilien detection, owner-occupancy assessments, collateral risk information, income reasonableness, third-party risk and identity fraud exposure. The product also provides extensive reporting on property history, market conditions and other occupancy, employment and identity history information to provide the most efficient fraud assessment available.

According to First American CoreLogic, in a recent test of more than one million loans, LoanSafe identified 70% of the lender-identified fraud and more than 50% of the total foreclosure and charge-off losses within the top 10% of scores. In other retrospective tests, LoanSafe identified twice more fraud and early payment default risk than alternative anti-fraud products within the highest 10% of scores.

LoanSafe also produced significantly fewer false positives. The system monitors third-party entities and understands unique data anomalies indicative of fraud risk to generate the most accurate mortgage fraud scores available.

First American CoreLogic plans to migrate its current clients and those of BasePoint Analytics to LoanSafe Fraud Manager, which is part of the new LoanSafe Risk Manager suite, over the next 12 months. In the interim, customers will continue to have access to the legacy versions of FraudMark and LoanSafe 2.0.

In addition to LoanSafe, to allow homeowners to manage the value of their homes and protect themselves against fraud, First American CoreLogic has also introduced ePropertyWatch, a free service that provides homeowners with information on their home and surrounding community.

ePropertyWatch offers homeowners regular e-mail updates on the value of their property; recent sales, price trends and foreclosure activity in their neighborhood; and public record filings against their property. All homeowners whose homes are included in the database coverage are eligible for the service.

Monitoring of public record filings against properties is increasingly needed to guard against a new and dangerous type of identity fraud called "house stealing." In a house-stealing scam, con artists target a specific property and assume the identity of that owner by creating fake identification documents.

They then purchase real estate forms easily obtained from office supply stores and, through forgery and misrepresentation, file these deeds with the proper public authorities, thereby transferring properties fraudulently. So, even though an owner may be living in a property and making their monthly mortgage payments, somebody else may have assumed ownership on paper and refinanced or even sold the home.

Additionally, the company has built a national fraud data repository to help clients combat all types of mortgage fraud and to further enhance the predictive performance of its anti-fraud solutions.

The First American CoreLogic National Fraud Database is a central repository of application and transaction data in the mortgage industry that includes more than 80 million loan applications, an aggregation of reported fraud data and a collection of fraud information to help users build precise pattern recognition scoring models.