Comergence Takes Strong Lead in Assisting Mortgage Lenders with Anti-Money Laundering (AML) Compliance

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Comergence estimates as of Nov. 1, 2012 less than 10 percent of residential mortgage loan originators (RMLOs) have documented compliance with anti-money laundering laws since Aug. 2012 effective date

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As a new anti-money laundering (AML) law went into effect in the United States on August 13, Comergence -- the lending industry's premier risk management firm specialising in residential mortgage loan originator (RMLO) due diligence and profile surveillance -- has taken the lead in helping lenders manage their RMLO’s compliance. The company has created a proprietary AML certification process for their existing lender clients, along with reporting and analytics to track which of their RMLOs have complied with the law.

For the first time, the global Financial Crimes Enforcement Network (FinCEN) will require non- bank mortgage lenders and originators to implement an AML program and file Suspicious Activity Reports (SARs) for certain loan transactions. FinCEN established this AML program in accordance with the Bank Secrecy Act (BSA). The guidelines relating to the AML requirement became effective on April 16, 2012, and the AML Program’s effective compliance date was Aug. 13, 2012.

"We estimate that only 7.4 percent* of the country’s mortgage originators are currently in compliance,” said Greg Schroeder, president of Comergence. “What’s alarming is that approximately half of the phone calls we receive from originators regarding this new requirement is that they don't even know what the AML law is. We are working closely with all parties to bring them up to speed quickly, and provide them with a solution that’s comprehensive, easy to use, and easy to manage."

Until the Comergence software platform was created, lenders only had faxes, email, spreadsheets and paper files to manually manage compliance with RMLOs. There had been no centrally managed platform available to manage a database of third-party originators.

The Comergence system provides an electronic overview and tracking of who is in compliance with this regulation, in addition to a host of other features.

"The penalties for failing to comply with the AML regulations are severe, which include a lender's responsibility to monitor its clients,” said Eddie Rodriguez, chief compliance officer at First Mortgage Corporation, a Comergence client. “First Mortgage Corporation appreciates and welcomes Comergence's proactive effort to monitor each of our clients by ensuring that they've complied with the new laws.”

Comergence supplies a robust system for lenders to manage their mortgage originators. A new dashboard reporting system can identify down to the account executive level which RMLO is in compliance and can parse lists for management in order to track and gain compliance with each of their clients.

“Working with our partners at Comergence has proven to be one of our best decisions in thirdparty origination,” said Matthew M.Teskey, vice president of correspondent lending at Weststar Mortgage Corporation. “When our counterparts hear that we utilize Comergence for RMLO tracking and compliance management, they breathe a sigh of relief as well. Not only is the platform highly effective for our needs, but the Comergence team that supports us is top notch. As an example, when the BSA/AML deadline approached, the Comergence team proactively went to the client community with attestations and compliance surveys as a way to make our lives easier.”

About Comergence:

Comergence is the lending industry's premier risk management firm specializing in mortgage originator due diligence and profile surveillance. Comergence offers a full suite of hands-on and automated services such as Originator screening and compliance monitoring.

The company has compiled a comprehensive database of 200,000+ records on every licensed mortgage originator in the US, along with aggregated and appended industry-specific data that provides clients with crucial information for proper third party risk management.

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Joel Otten
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