Fraud Detection project needs help!

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June 30, 2012 at 12:16 pm #2620


1. We need you! I know how busy everyone is, but the foreclosure crisis continues to unfold. We’ve got important work going on in the realm of mortgage fraud detection, supporting people going through foreclosure, and challenging the “hiddenness” of the foreclosure sales at the courthouse. It’s fun! It’s exciting! It has real implications for real people! Okay, truth is, some of it is kind of boring at times (leafing through 615 foreclosure files, for example 😉 but it’s still important!

2. Come to the Thursday morning meeting! It is so much easier for us to stay connected and energized if we actually see each other face-to-face on a regular basis. At the FWG social that was held at Julie Knight’s house last Saturday, several folks re-committed to doing all they can to getting to the Thursday morning meet-up at Spring Garden Bakery. Bring yourself, plus any thing you’re working on & with: scanners, data collection forms, video, etc. It helps us get stuff done if we have all the stuff we’re working with.

3. Some news about the fraud detection project. We had a great discussion across plates of good food at Julie’s last weeked. In the process, we clarified why we’re working so hard on this tedious, drawn out business of data collection for the fraud detection project. Based on that discussion, Nathan and I have written some stuff that’ll ultimately get posted on the website, but I wanted to make sure everyone had access to this thinking–in hopes it motivates you to keep on trucking!! See below.

4. Also, Fraud Detectives: you can now check out scanners and pick up data collection forms at Glenwood Coffee and Books! If you are unsure of the case numbers you should be reviewing, call one of the senior detectives, and they’ll give you the file numbers for you to focus on.

Senior Detectives Contact List

Lynn Johnson


Julia Kimmel


Julie Knight


Nathan Pius


Todd Warren


The Mortgage Fraud Detectives Project has trained ordinary folks to carefully comb through a large, scientifically selected sample of Guilford County foreclosure proceedings. For each case we look at, we systematically collect over 100 distinct types of information, from the dozens of legal documents that exist in each file. It’s a lot of work, involving the completion of a ten page data form, scanning of signatures, and intensive brain work, parsing variations of forms and terminology. It takes anywhere from 20 minutes to an hour to collect the data from just one foreclosure file. We’re working to record the data from over 600 of these files.

It’s occasionally evident in a single file that there is some kind of fraud, but most times, the only way to detect fraud is to examine lots and lots of files, looking for patterns and making comparisons. For example, think about what Jeff Thigpen was able to show in the Guilford County Registers files, looking at Deeds of Trust (aka mortgages) with regard to faked signatures. He couldn’t look at any one example of Linda Green’s signature and see that it was a fake (Linda Green is the name of a now infamous robosigner). He had to look at thousands of files to identify multiple, different signatures to prove that many people were signing Linda Green’s name. We’re doing something similar–but with even more types of data–looking at at the foreclosure files in the Clerk of Court’s office.

Once we get the data into the database, we’ll be easily able to analyze it for patterns and to make all kinds of comparisons. We’ll be looking for help from Rochelle and others around the country who have started to identify the names of “bad actors” (e.g., people who’ve signed affidavits they haven’t prepared themselves or notaries who’ve notarized signatures they did not actually see being executed and so on). We’ll be able to search our database for these names and quickly pull up the cases in which they play a role. We’ll also be able to compile lists of all the people and firms who are managing and profiting from the whole foreclosure “industry.” We may even be able to estimate the amount of money generated for these firms from Guilford County foreclosures. We’re don’t know yet the full range of analyses that we’ll do on the data once it’s in the database, but we’re pretty certain that we’ll be able to use the data to document the levels and types of fraud that are going on in Guilford County foreclosures. And that’ll be a story worth telling!

Specific ways we can use the data include:

1 – Robo-Signing
Data collection will provide us the hard evidence of systemic fraud perpetrated during foreclosure proceedings as they exist today. Robo-signing is the most commonly committed of these fraudulent practices. We will document the extent to which robo-signing was practiced and accepted in Guilford County and release these reports to local and state agencies and to local and national media outlets.

2 – Follow the Money
As our investigation of foreclosures in Guilford County progresses, it is becoming apparent that a small number of corporations, law firms, service companies and their subsidiaries appear repeatedly in the case files. These entities provide services and submit fees for those services to the plaintiff in each of these cases. Those fees are ultimately paid by the homeowner or, more likely, the mortgage insurers. These insurers are, in most cases, government supported companies. Since government entities are supported by tax revenues these fees end up being paid out of taxpayer dollars affecting all taxpayers negatively.

3 – Clerkish Coziness
As in most industries, personal relationships are formed between employees of various organizations who work together on a regular basis. These relationships exist within the Clerk of Courts office. Paralegals from various law firms, service company employees and others who regularly conduct business at the Clerk’s office establish methods of doing business with the Assistant Clerks to facilitate completion of their assigned tasks. While these informal relationships are benign in nature, they contribute to an environment where the general public, specifically homeowners in foreclosure, don’t receive the consideration given to those “regulars” who appear at the Clerk’s office repeatedly. For example, a stack of 20 foreclosure hearing notices submitted for filing by a paralegal who performs this task on a weekly basis may not be scrutinized with the same attention to detail that the assistant clerk would give a request for a hearing postponement submitted by a homeowner the Clerk has never seen before. There is a need to establish that the Clerks, as public employees paid via tax revenues, have an obligation to represent the public, not banks and law firms, during these transactions. Failure to protect uninformed homeowners through the process leads to many uncontested foreclosures resulting in unnecessarily abandoned homes that destroy neighborhoods and communities.

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