The mortgage industry is cyclical. If you have been in the industry long enough you know the reality of living and working in an industry where fortunes ebb and flow with volume and revenue.
The flip side of the volume and revenue flow chart is the accompanying increase in fraud cases in origination and closings when volume (and revenue) is down.
It is a fact borne out by FBI and FinCEN national crime statistics that mortgage loan originators, real estate agents, appraisers, notaries, and settlement agents are tempted to initiate, facilitate or look the other way with respect to fraud when the pressure to maintain income becomes a burden too great to ignore.
As those who study fraud know, the fraud triangle is made up of pressure, opportunity and rationalization. A down-turned mortgage market raises the likelihood of incidents of fraud as these very factors come into play.
As we enter the 1st Q 2022, fraud overall is expected to rise, including origination, wire and closing fraud. Be careful of the people you do business with. Investigate and monitor your third party relationships. Know who you can trust and be vigilant. We’ve been through these downturns before and we know exactly how they play out. Forewarned is forearmed.
At Secure Insight we study, analyze and create tools to prevent wire and closing fraud which have successfully protected lenders in more than 17 Million residential mortgage transactions. If you want to be better prepared to face the expected rise in fraud this year, contact us and arrange a demo of our tools. Since 2012 we have been the premier wire and closing fraud prevention partner in the mortgage industry.
Happy New Year!