Fraud prevention back on broker agenda

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A fraud-prevention expert – also a mortgage agent – is asking his peers to double check their file protection measures against a list of six essentials. It’s a way of guarding themselves, their clients and their industry against the kind of recent broker lapse grabbing headlines in Alberta.

“We have to be careful that the perception doesn’t get out there that mortgage brokers aren’t taking the necessary precautions to protect the information of current and past clients,” said Graham McWaters, an agent with the Mortgage Centre in Richmond Hill, Ont., as well as the author of the bestselling book The Canadian Guide to Protecting Yourself From Identity Theft and Other Fraud. “It’s easy enough when you work from home or on the road to forget to always take all the required steps to properly secure client files, that would include mortgage brokers. But that can be avoided all together by taking six very straightforward steps of action.”

Police reports suggest few, if any, of those precautions were taken by a mortgage brokerage in Edmonton, after its files were pulled from the garbage in August.

Construction workers found five boxes of client files, containing social insurance numbers, credit-card information and mortgage details, said a spokesman for Alberta’s privacy commissioner, which led an investigation into the privacy breach. The case also garnered headlines across the province and bad PR for a mortgage industry actively working to gain consumer market share and respect.

That campaign was challenged by earlier security breaches at Toronto brokerages in 2008, with the federal privacy watchdog registering concerns about “security; haphazard storage of documents containing personal information; inadequate consent by clients; and a general lack of understanding about, and accountability for, privacy issues.”

McWaters is hoping to prevent a repeat occurrence, pointing to those six easy steps.

“Preventing client identity theft starts with installing anti-spyware on your computer, something all mortgage brokers should have,” he told “Something basic like shredding documents is another must, along with installing password protections on your computer and locking it down when you leave the room. It’s just as essential to lock filing cabinets and install an alarm system on your house – if all businesses do it, why wouldn’t a mortgage broker working from home do the same?”

Chief among the things brokers should not do, he said, is transporting client files in their cars and leaving them unattended, whether the vehicle is locked or not.

Some brokers are taking other proactive steps through digital storage and tighter screening of both sales and administrative staff.

Hype aside, argues Dustan Woodhouse, a high-volume broker with Dominion Lending Centres Canadian Mortgage Experts on B.C.’s Lower Mainland, “cloud computing” is reshaping the way brokers access sensitive client files away from the office, allowing them to minimize the privacy threat associated with mobile access.

“In our industry, most brokers are making efforts to protect their clients sensitive data, however the constant risk of data loss or data theft can be greatly reduced for a small monthly investment that pays large ‘peace of mind’ dividends for both clients and brokers alike,” he told “Also not having any client data stored on the device I am carrying around is a relief.”

  • Angela Wong-Liao, Invis Inc on 2011-10-07 9:14:23 AM

    I am strong believer in customer confidentiality, especially in the financial industry. In my opinion, nothing can be more damanging if we breach this basic business professional requirement. Yes, we should have password for all our gadgets, ie: blackberry, Iphone, Ipad, laptop and PC, we should also ensure to destroy and shredded any documents that have our customer's information, ie: address, telephone number and email address. Food for thought, together, we can build a better image for our industry and a strong and trusting relationship with our customers.

  • Richard Beauchamp Dominion Lending West Coast on 2011-10-08 10:29:45 AM

    Yes it is important that we take all of the necessary precautions in the deletion of important documents and shredding of paper documents. More importantly than all of those outlined precautions is for us as mortgage professionals to be more vigilant with our clients and the information they submit. Store important documents in not so easy to find places, make sure anti-virus and spyware is up to date and in the best working order possible.

    One of the most important things to do for your own computer, for all mortgage professionals, is to do a scan once a week minimum to make sure that no virus can be used to back-door a hacker on to your system.

    Be aware, be vigilant and above all else be professional.

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