Mortgage Fraud Special Report
A public and mortgage industry debate on how fraud is affecting the marketplace is open and ongoing. Nobody has the ultimate tool to prevent it or uncover fraud. It is almost like a masked ball where the only thing obvious is the dancing floor.
Some in the industry are currently wondering whether 2006 will be a record year for identity theft, since data show that today, for instance, there are about three times more identities of U.S. residents on record than there are actual residents. Statistics by the Privacy Rights Clearinghouse indicated that during the first six months of 2006, over 32 million identities were stolen online.
Issues related to identity theft and fraud may vary depending on where one sits. Both the industry and customers face challenges. To protect customers and the reputation of the mortgage industry, the National Association of Mortgage Brokers recently said the Coalition Against Broker Fraud has created "a comprehensive database" on brokers and other financial business insiders who have been or are suspected to have been involved in fraudulent activity.
Curiously, one of the co-founders of CABF, Mitch Freifeld, is one of those brokers or other mortgage professionals who may end up appearing on such fraud-related lists and then deal with defending their good name.
Mr. Freifeld said promoting CABF is his way of making up for his past criminal record and making a positive difference.
Fraud has been committed by high-ranking executives of large federal entities like Fannie Mae, which is paying $400 million in fines. However, to its credit, the industry is introducing helpful tools that combat fraud and provide decision support.
Meanwhile, fraud and foreclosures are an equally sensitive problem in many areas of the country. Yet data show South Florida and Southern California markets are more vulnerable. For example, since January 2006, defaults were up by 50% in Broward County, Fla. (c) 2006 Mortgage Servicing News and SourceMedia, Inc. All Rights Reserved. http://www.mortgageservicingnews.com http://www.sourcemedia.com