MBA 2007 MARI Report Exposes and Explores Residential Mortgage Fraud Against Lenders in US

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The Mortgage Bankers Association (MBA) today announced that the Mortgage Asset Research Institute, LLC (MARISM), a ChoicePoint® (NYSE: CPS) company, has completed its 10th Periodic Mortgage Fraud Case Report to MBA. The report examines the current state of residential mortgage fraud and misrepresentation in the U.S. based on participating subscribers' reports to MARI.

MARI: Mortgage Fraud Solutions and Identity Risk Management Solutions

The current market conditions, compounded by mortgage fraud, are having a detrimental impact on our entire national economy

The Mortgage Bankers Association (MBA) today announced that the Mortgage Asset Research Institute, LLC (MARISM), a ChoicePoint® (NYSE: CPS) company, has completed its 10th Periodic Mortgage Fraud Case Report to MBA. The report examines the current state of residential mortgage fraud and misrepresentation in the U.S. based on participating subscribers' reports to MARI.

The report, which sites Florida as topping the MARI Fraud Index list for the second consecutive year and Nevada climbing to the No. 2 ranking, was released during MBA's annual National Fraud Issues Conference in Chicago.

"The current market conditions, compounded by mortgage fraud, are having a detrimental impact on our entire national economy," said David Kittle, CMB, Chairman-Elect of the MBA. "The MARI report provides critical insight for those in the real estate finance industry to better understand the factors contributing to these circumstances so that our communities and member companies are protected."

According to the Mortgage Fraud Case Report, "The conditions in the mortgage industry for the last half of 2007 made the year one for the record books." Overall, 2007 marked the lowest volume of mortgage loan originations since 2002, the highest number of delinquencies and foreclosures, rapid and near complete shutdown of the non-conforming secondary market and hundreds of announced closures of mortgage originators.

"Because fraud is persistent, it is imperative for the mortgage industry to collaborate in its efforts to combat mortgage fraud against lenders," said Merle D. Sharick, ChoicePoint Vice President and MARI's National Manager of Business Development. "MARI will continue its efforts to disseminate current data for use by MBA's members through our annual fraud report."

Highlights in the Mortgage Fraud Case Report include:

  •     In addition to Florida and Nevada, the remainder of this year's top ten (in order): Michigan, California, Utah, Georgia, Virginia, Illinois, New York and Minnesota;
  •     Colorado showed the greatest improvement from prior years' rankings, dropping out of the top ten for the first time in five years;
  •     The most common types of fraud found in 2007 originations continue to be in the areas of employment history and claimed income; and
  •     The continuing unsettled state of the mortgage market as a whole does not bode well for any improvement in avoiding fraud in the coming year.

ChoicePoint provides MBA members the annual case reports on mortgage fraud as well as discounted fees to participate in MARI's Mortgage Industry Data Exchange (MIDEX®) database. The MIDEX database allows mortgage lenders, insurers and agencies to exchange information about companies and professionals that have been involved in loan transactions containing alleged fraud or material misrepresentations.

A MARI Loan Fraud Alert Service (LFAS), a new industry-contributed mortgage loan process management database, enables lenders and investors to identify potential application risk, patterns of fraud and hidden relationships among parties involved in mortgage transactions. MIDEX and LFAS are key components of ChoicePoint's Identity Risk Management (IRM) solutions for the mortgage industry. ChoicePoint's IRM solutions help mitigate fraud by allowing organizations to better know their customers, employees and vendors.

The Mortgage Fraud Case Report is available both on the MBA Web site, http://www.mortgagebankers.org and MARI's Web site, http://www.marisolutions.com/resources-news/reports.asp.

About the Mortgage Bankers Association

The Mortgage Bankers Association (MBA) is the national association representing the real estate finance industry, an industry that employs more than 370,000 people in virtually every community in the country. Headquartered in Washington, D.C., the association works to ensure the continued strength of the nation's residential and commercial real estate markets; to expand homeownership and extend access to affordable housing to all Americans. MBA promotes fair and ethical lending practices and fosters professional excellence among real estate finance employees through a wide range of educational programs and a variety of publications. Its membership of over 2,400 companies includes all elements of real estate finance: mortgage companies, mortgage brokers, commercial banks, thrifts, Wall Street conduits, life insurance companies and others in the mortgage lending field. For additional information, visit MBA's Web site: http://www.mortgagebankers.org.

About Mortgage Asset Research Institute

The Mortgage Asset Research Institute, LLC (MARI) is a premier provider of mortgage fraud prevention solutions and information services to the mortgage and financial services industries. MARI's 600+ subscribers represent the entities involved in over 80% of the wholesale mortgages originated in the United States. MARI's Mortgage Industry Data Exchange (MIDEX) service assists lenders in identifying mortgage and real estate professionals that have been associated with fraudulent activity or serious misrepresentation. For more information about MARI's services to combat mortgage fraud, go to http://www.MARISolutions.com.

About ChoicePoint

ChoicePoint (NYSE: CPS) provides businesses, government agencies and non-profit organizations with technology, software, information and marketing services to help manage economic risks and identify business opportunities. Consumers have free access to the reports we create at ChoiceTrust.com. Learn what we do to protect consumer privacy by visiting PrivacyatChoicePoint.com and, for more information on our company, go to http://www.ChoicePoint.com.

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