Partners In The Fraud Prevention Game

Agoura Hills, CA-Some firms are trying to increase fraud prevention efficiency through strategic partnerships.

The mortgage industry is tackling fraud through initiatives and partnerships designed to help mitigate fraudulent practices both during loan origination and servicing. If in the past a flourishing subprime market made it easier to commit fraud, its disappearance has not stopped fraudulent activity, which is still on the rise. What has changed is that now fraudsters are becoming more tech-savvy and creating new schemes.

Residential mortgage risk mitigation, fraud detection and regulatory compliance tools provider Interthinx here recently joined forces with technology provider MortgageDashboard to integrate their fraud prevention and loan origination systems.

The integration enables users to screen the database for potential fraudulent activity. The mortgage fraud prevention firm said in the past few months it has been busy working to achieve the integration of Interthinx's FraudGuard tool designed to measure and score fraud risk against public, private and proprietary data sources, with MortgageDashboard's loan origination system.

"Mortgage fraud continues to impact the industry in insidious and highly destructive ways, and Interthinx is committed to aligning with companies like MortgageDashboard that share the common goal of fighting fraud at origination," said Interthinx president Kevin Coop.

Through the partnership MortgageDashboard customers can access millions of mortgage applications running through Interthinx systems that can provide shared data and findings not available anywhere else in the marketplace. The integration offers its customers a seamless interface with automatic and proven screening for potential fraudulent activity. MortgageDashboard loan origination system customers like BenchMark Mortgage are using the system to check and close loans while minimizing the potential for fraud.

The goal, according to Bryan Harlan, CEO of BenchMark Mortgage, is to catch and prevent fraudulent activity "before it has the opportunity to affect our back office, saving significant costs and manpower."

As a result of the Interthinx integration, the added capabilities of MortgageDashboard enables us to confidently check and close loans without potential fraud becoming an issue, he said.

"To provide a robust loan origination system, vendors have realized that we must integrate components that help our customers easily detect and prevent fraudulent activity and risk," said MortgageDashboard president Jorge Sauri. "We selected Interthinx to give our customers streamlined fraud detection via a single click within MortgageDashboard."

According to Mr. Coop, to make the process more effective, Interthinx is supporting its fraud detection and prevention tools with proactive education and training that helps mortgage professionals identify fraudulent activity before it does damage to a company.

This integration with MortgageDashboard follows Interthinx's launching of "FraudBytes," a new Web-based video news series called to provide the financial services industry with current information on industry changes so they can better guard themselves against fraudulent practices. FraudBytes, according to the company, was the next logical step to its previous fraud prevention videos "Fraud Angels," "FSI: Fraud Scheme Investigation" and FHA webisodes.

Partnerships appear to be an effective way to maximize technology and product effiicency as more and more mortgage companies are trying to prevent or minimize fraud during mortgage loan origination and servicing in times when the volume of loans being processed has increased significantly.

Other fraud prevention companies such as DataVerify have formed strategic partnerships with lenders and servicers upgrading their offerings to combat mortgage fraud.

Mortgage origination technology provider Mortgage Cadence partnered with fraud detection firm DataVerify, the company said, to integrate Mortgage Cadence's Orchestrator enterprise lending solutions platform with DataVerify's Data Risk Intelligent Verification Engine product. The integration with DataVerify is designed to enhance Mortgage Cadence's overall compliance offering and provide customers with a seamless loan data feed into the DRIVE platform. That data feed then returns information back into Mortgage Cadence Orchestrator.

Tim Counterman, director of product management and compliance at Mortgage Cadence, said in a statement, "The reports and scores that are returned allow Orchestrator users to quickly identify legitimate borrowers while reducing false positives, ensuring compliance with red flag rules and minimizing costly queries to the Social Security Administration." DataVerify provides a proprietary collateral risk assessment model that evaluates market and subject property characteristics to determine the overall collateral risk. This assessment provides public and nonpublic data analysis of foreclosure activity, flip activity, subject transfer history, geographic conditions and market sale.

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