Compliance

Fraud definition (yesterday’s version):1.The intentional deception resulting in injury to another person.2.Something intended to deceive; deliberate trickery intended to gain an advantage.

A New York real estate attorney this week pleaded guilty to bank fraud and conspiracy to commit bank and wire fraud in connection with a scheme that defrauded residential lenders out of more than $23 million.

A New York appeals court dismissed a lawsuit against bond insurer MBIA brought by twenty of the world's largest financial institutions, including Bank of America, Citigroup, and JPMorgan Chase. The lawsuit claimed that the 2009 split of MBIA amounted to a fraudulent conveyance.

Recovery in the mortgage insurance sector will continue during 2011, as the sector eyes sustained profitability in 2012, according to an analyst at Credit Suisse.

The Federal Trade Commission’s identity theft red flags rule that required businesses to meet identity theft consumer protection laws before the Dec. 31 deadline is now in full effect. And according to FTC estimations it affects about 11 million businesses, many of which may still be unaware of the law and its impact on their business.

The New York Supreme Court ruled that MBIA Insurance Corp. did not have any way to discover if GMAC Mortgage LLC intentionally misrepresented the true nature of mortgage-backed securities that MBIA insured.

As we start 2011, the industry needs to review, change and implement Quality Control plans that can prevent mortgage fraud and reduce defaults in 2011. All origination platforms need to take the proper steps with quality control that ultimately will provide and support liquidity through all types of market cycles, thus benefitting all the mortgage industry stakeholders for years to come.

A foundation representing investors in the United States as well as three other parts of the globe said it is taking a shareholder fraud action in a Utrecht civil court related to a major acquisition by Fortis NV, a European company that had been hard hit by U.S. subprime exposures and subsequently went through a government bailout.

For the past two years, the Federal Deposit Insurance Corp. has maintained a consistent crisis-response posture — bulking up its manpower, swooping in to resolve failed institutions and standing behind their depositors.

A ruling by Massachusetts' highest court Friday repudiating a widespread securitization practice could scuttle other foreclosure cases statewide and may portend similar blows to the industry elsewhere.

The Federal Reserve Board is publishing an interim rule amending Regulation Z, which implements the Truth in Lending Act. This interim rule revises further certain requirements of the Mortgage Disclosure Improvement Act of 2008.

The Pennsylvania Department of Banking took 114 enforcement actions, mostly related to mortgage activity, during the fourth quarter of 2010.

Fannie Mae’s latest homeowner outreach program is a website with links to resources and information for borrowers who want to avoid foreclosure.

MDA Lending Solutions launched a suite of mortgage fraud prevention software based on the recommendations that Fannie Mae gave the industry in the Loan Quality Initiative.

Many customer advocates warn that identity theft is a problem for all--more so homeowners to whom such a problem can lead to default or foreclosure--need keep in mind during the year. Spokesperson for the National Foundation for Credit Counseling Silver Spring, MD, Gail Cunningham says that even though identity theft risk is higher during the holidays, customers need to regularly check their credit rating reports and other resources designed to help them avoid having access to credit suspended or compromised.

MDA Lending Solutions launched a suite of mortgage fraud prevention software based on the recommendations that Fannie Mae gave the industry in the Loan Quality Initiative.

Mortgage fraud costs billions every year and despite law enforcement efforts to curb it, the number of cases continues to increase. Various software products help lenders review loan files, monitor borrower trends and track potential problems and now the federal government will begin using some of that same technology in its own mortgage fraud investigations.

The Financial Crimes Enforcement Network has now proposed a requirement that NONBANK RESIDENTIAL MORTGAGE LENDERS AND ORIGINATORS, LIKE OTHER TYPES OF FINANCIAL INSTITUTIONS, ESTABLISH ANTI-MONEY LAUNDERING PROGRAMS AND COMPLY WITH SUSPICIOUS ACTIVITY REPORTS REGULATIONS.

In a letter sent to Ohio judges, the state’s Attorney General Richard Cordray has requested that its courts continue to pay close attention to foreclosure cases that may have affidavits signed by so-called robo-signers and highlighted several Common Pleas courts that have taken action to address the situation.

Industry vendor Kroll Factual Data, Loveland, Colo., said it has started a new technology-based service aimed at helping clients comply with fair credit reporting risk-based pricing regulations that take effect Jan. 1, 2011.