As reports of real estate fraud persist, a group of industry leaders has formed the Coalition Against Broker Fraud to combat mortgage firms’ mounting losses from insider mortgage fraud.
In a May 2005 report, the FBI estimated that insiders accounted for 80 percent of the $86 billion in mortgage fraud losses in 2004.
The coalition, formed in early 2006, has announced the addition of two new advisors that will help guide the group’s efforts. The new advisors are Jim Hodge, the chief executive officer of Allied Home Mortgage, and Bobby Gentry, the president of the West Coast Chapter of the Florida Association of Mortgage Brokers.
“With the invaluable guidance of our new advisors, we’re undertaking new initiatives to help weed out fraud in our industry,” said Mitch Freifeld, co-founder of the Coalition Against Broker Fraud. “As Allied’s CEO, Jim has gained invaluable insights into how to identify and sift out mortgage fraud. He’ll be helping us as we continue to expand and fine-tune our registry of mortgage brokers.”
Gentry will help spread the word about the coalition and expand the group’s growing list of suspected fraudsters, Freifeld said.
Members of the mortgage industry’s new “fraud squad” have created a comprehensive registry that includes exclusionary or disciplinary lists from public records of regulatory agencies, licensing boards, GSEs, credit bureaus and/or other mortgage industry organizations. The registry aims to stop a recurring problem among brokerages, which involves brokers switching branch organizations once they are suspected or known to be committing fraud within one organization.
Through this registry, Coalition Against Broker Fraud members have merged historical data and have added external public data to yield a comprehensive insider fraud resource. Approximately 10,000 records currently exist in the registry.
Coalition members include Global Branch Solutions, American Pacific Mortgage (co-founder), Advantage Credit, BNC Mortgage, NFM, Freedom Mortgage, American Home Mortgage, AllFund, Home Capital Funding, America’s Mortgage Broker, American Home Loans, Radian, Challenge, and Apex.