Allows lenders to identify and share suspected fraudulent activity in loan applications from the point of origination
MERSCORP (MERS) and Interthinx, a provider of risk mitigation and regulatory compliance tools for the financial services, have launched MERS FraudALERT, a national fraud prevention database. It is expected to allow lenders to seek, identify, and share suspected fraudulent activity in loan applications from the point of origination.
Reportedly, MERS FraudALERT, powered by Interthinx will help identify and prevent fraud through the sharing and reporting of key data among the more than 62 million loans currently registered on the MERS System. Lenders using MERS FraudALERTSM will submit loan application data and incident reports with suspected or confirmed fraudulent activity to a centralized database. The system will then notify other lenders who have loans that may have connections to the data, alerting them to possible fraudulent transactions in their pipelines.
Interthinx has said that lenders who register their loans on the MERS System will have immediate access to the first industry wide database of fraud-related information through the new product, making any fraud screening technology more effective. MERS FraudALERT, powered by Interthinx, will be available in the fourth quarter of 2009. Additionally, Third-party fraud solution vendors will also be able to access and leverage the system.
RK Arnold, president and CEO of MERS, said: “While the industry currently has access to excellent loan-level fraud detection technology, lenders still face unacceptable risk. Fraudsters circumvent those tools by perpetrating multiple instances of fraud concurrently because no one is speaking to each other. Only by creating a collaborative industry wide fraud prevention database can this activity be stopped. MERS FraudALERT will become the national mortgage fraud detection and prevention utility. By participating, lenders can show that they take fraud prevention seriously.”
Kevin Coop, president of Interthinx, said: “Our goal from the beginning has been to eradicate mortgage fraud, and we have developed the industry’s best tools to accomplish that. But our technologies are most effective when they have access to more data. Through this database, we will be even better at helping lenders detect fraud before loans are funded. We are very proud to be associated with this project and believe it is the most significant advance on the fraud risk mitigation front in recent history.”