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Both the Financial Crimes Enforcement Network and Interthinx released their numbers for mortgage fraud for the third quarter of 2011. While they seem to be addressing the same thing, the results are very different.
For instance, Interthinx ranked Arizona the No. 1 riskiest state for mortgage fraud, while that state didn’t even make the top 5 of FinCEN’s list (it came in sixth).
So how could that be?
Well, FinCEN and Interthinx get their numbers from two different places. FinCEN grabs its numbers from suspicious activity reports, which are typically filed after loans have been closed, while Interthinx bases its report on the frequency with which indicators of fraudulent activity in mortgage applications are detected when they are processed through the company’s FraudGUARD system.
In other words, FinCEN is largely focusing on fraud after it’s already happened, and Interthinx is focusing on attempted fraud. That’s why Interthinx markets their numbers as tracking the “risk of mortgage fraud.”
So, to clarify the example used above: Arizona is the No. 1 riskiest state for mortgage fraud based on fraud attempts, and the sixth based on the number of SARs filed.
So, while it may seem the companies are tracking similar things…they really aren’t. It’s all in the details, folks.