ClearPro aims to build consumer trust and fight fraud within the mortgage industry

Robb NelsonMortgage Talk Canada

From Equifax Canada – Newsroom

Honesty is the best policy when it comes to a home purchase, a message that appears to be getting through to most Canadians, according to a recent Equifax survey on mortgage fraud. Less than half (45 per cent) of survey respondents, however, trust their broker to complete necessary forms on their behalf, 29 per cent admit they don’t know if they should.

Fraud within the mortgage industry has damaged brand equity, company reputations and impacted customers’ trust in recent years. To stem these recent developments, Equifax is launching a new professional background screening tool called ClearPro™ to help mortgage brokers, principal brokers, and broker owners identify fraudulent activity and patterns within their businesses.

“Leaders in the mortgage industry need to be a trusted choice with consumers,” said Carl Davies, Head of Fraud & Identity at Equifax Canada. “In today’s digital world, if an agent or broker who represents you commits fraud, the reputational cost is incalculable. Trust is broken. ClearPro is a sophisticated always-on background screening tool that can help maintain consumer trust in the mortgage process and help to reduce costs associated with fraud.”

ClearPro does this by checking multiple data sources to confirm three important indicators:

  • Credit File Database. ClearPro accesses Equifax’s robust data assets, including our proprietary credit file database, to check for anomalies in an individual’s financial and credit history. 
  • Identity. ClearPro is an identity proofing solution that cross checks input information against Equifax data assets to identify and confirm any misuse of name, address, phone numbers by an agent or broker.
  • History. ClearPro searches current and historical negative media, both international and domestic publication, and sanctions lists, including international and government agencies. If a match is found to an employee, agent or representative, it is validated and confirmed.

“The decision on how to proceed with a flagged individual is up to the organization,” added Davies. “Our aim is to root out bad actors, which will in turn establish credibility and confidence, building trust with customers. Mortgage fraud must be taken more seriously.”

Mortgage fraud is defined as when someone – a consumer, a mortgage broker or agent, a real estate agent or a lawyer – misrepresents, lies or exaggerates information to obtain a mortgage that would not have been granted if the truth had been told. 

ClearPro is an example of how Equifax helps Canadian businesses and their customers live their financial best.

Fostering trust and educating consumers 

Additional survey results also revealed a need for the mortgage industry to engage in consumer education with respect to mortgage fraud:

  • 76 per cent say lenders should be doing more to protect them from fraud and identity theft
  • When asked if it’s acceptable to inflate your annual income when applying for a mortgage 16 per cent of millennials and 9 per cent of the general population said yes, a significant drop from 23 per cent of millennials and 12 per cent of the general population in 2019.
  • Four-in-ten agree mortgage fraud is more of a risk to the lender, but they’ll end up paying for it with higher interest rates (44 per cent) and mortgage fraud is a growing problem (40 per cent)
  • 40 per cent have concerns that their mortgage information could be used by an identity thief to take out a loan under their name
  • 14 per cent of millennials surveyed indicated they had not been entirely truthful on a credit or loan application vs. 7 per cent as a national average
  • 11 per cent say mortgage fraud is a victimless crime (a legal offense to which all parties consent and no party is injured); that number was higher among millennials surveyed at 16 per cent
  • 9 per cent admit they haven’t been entirely truthful on a loan application 

Equifax surveyed 1,540 Canadians ages 18-65, Feb. 5-7. A probability sample of the
same size would yield a margin of error of +/- 2.5%, 19 times out of 20. 

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