DataVerify announced today changes made to its fraud management platform, Data Risk Intelligent Verification Engine (DRIVE), that help mortgage lenders identify potential short sale and property fraud losses. The program has updated tools for predicting risks such as employment disclosure, local conditions for flipping and individual history in the housing industry. A short sale is when a borrower pays less than what they owe on a mortgage to avoid foreclosure and give the lender a slight return on investment. Property flipping occurs when a property owner purchases a property and resells it in a short time period at an increased price. Property data provider CoreLogic (CLGX) said last month that the number of short sales has more than tripled since 2008, and will cost lenders approximately $310 million in unnecessary losses this fall. Losses per short sale average $41,500. CoreLogic reported fraud occurs once in every 53 short sale transactions and has, since reporting this data, launched its own technology platform to monitor the estimated 400,000 short sales taking place in 2010. The program keeps track of properties even after the sale is completed. President of DataVerify, Steve Halper, said the firm looked at track records of its own customers to see what improvements could be made to the platform. In reviewing its customer transactions, DataVerify discovered that 7% of the properties were valued under current market value for other similar comparable properties, 3% involved transactions in which the borrower is in the real estate or mortgage industry and did not disclosure that fact, 4% involved transactions in which the borrower has undisclosed self-employment, 4% involved transactions in areas with very high rates of property flipping activity and 4% contained IRS-valued tax transcript income variances of greater than 20%. "We used this type of information to create additional tools customers can use to predict these unique risks associated with short sales," said Halper. DataVerify is a mortgage technology firm based in Chesterfield, Mo. with a focus in fraud detection and prevention. Write to Christine Ricciardi. Disclosure: The author holds no relevant investments