As the country’s big four banks scramble to get ahead of the problem, there are solutions that can be implemented to greatly lower the risk of home loan fraud.
Joyce MoullakisAssociate editor
The financial services sector, police and policymakers should come together as soon as practicable to address the heightened threat of mortgage fraud in the nation’s $2.4 trillion home loan market.
The threat has certainly never been more real. And although the problem might at first seem difficult to combat, there are solutions that can be implemented to drastically reduce the risk of home loan fraud.
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Fraud thrives in “sloppy” environments where leadership ignores the rules.
The Fraud Triangle: For fraud to occur, three elements must be present: Pressure (the need for money), Rationalization (thinking “I deserve this”), and Opportunity (weak controls). You can only control the Opportunity.
Whistleblower Hotline: Provide an anonymous way for staff to report “odd behavior.” Most internal frauds are caught via tips, not audits.
Background Checks: Conduct credit and criminal record checks for all employees in financial or data-sensitive roles.
Annual Ethics Training: Make sure every staff member knows that the company has a Zero Tolerance policy toward “borrowing” from petty cash or fudging overtime.
