Protecting CRE Servicing From Fraud
(l. to r.: Frankie Jones, Sharon Briskman, Freddy Feliz, Amy Frazey, CPA, Howard Leiner)
HOLLYWOOD, FLA.–Keeping ahead of fraudulent activity is essentially a full-time function for mortgage servicers, panelists said here at MBA’s Commercial/Multifamily Finance Servicing and Technology Conference.
From AI-driven scams to cash mismanagement, fraud presents a growing risk in commercial real estate servicing.
Howard Leiner, Chief Technology Officer with Arbor Realty Trust, noted his team gets pulled in from the technology side every time there’s any kind of fraud, whether it’s related to a borrower or to third parties, a business email compromise or other situations. “So, we get pulled in to try to help with figuring out both how did this happen and how do we keep it from happening in the future,” he said.
Sharon Briskman, Executive Vice President with Greystone, noted she saw two other panels in the prior 24 hours that also talked about fraud. “I was at a dinner Monday night and we talked about fraud, and I think an important part of it is sharing the story. It may be embarrassing to share things with your team or with others within the industry; things like how long did it take to recover, or how did this happen? But I think as a community, we should continue to raise awareness. Technology is moving so fast, fraud is not as obvious anymore. So I think we also have to say we need to make sure we share examples.
Freddy Feliz, CIO & VP of Information Technology with the Mortgage Bankers Association, said training is the most important part of minimizing fraud. “Some of my MBA colleagues here will keep me honest,” he said. “We in IT are not their favorite department, because we keep sending test Phishing emails to see if any of our colleagues will fall for it and click on one of them.”
Feliz said regular testing reinforces the message and trains employees to use their human knowledge to recognize and minimize fraud.
“From a technology perspective, it is about education. It’s about training,” Leiner said. “It’s about teaching people how to spot fraudulent stuff that’s going on. We can build software that will detect something that you tell us to look for. But most of the time that it happens it’s not something you’ve seen before; it’s new at that time. So it really does start with people. It starts with training. It starts with education.”
Amy Frazey, Assistant Vice President, Investment Administration with StanCorp Mortgage Investors, noted customer service is the heart of the servicing business, “but it can’t be sacrificed for not being skeptical,” she added.
For example, bad actors may call a call center and push hard for something to happen immediately. Call center staff should be reminded that it’s okay to challenge requests and authenticate that the caller is who they say they are, Frazey said. “Customer service also means pushing back sometimes to verify,” Frazey concluded.
