Brokers are calling for stricter consequences for players who ignore mortgage submission rules, and one suggestion is gaining traction.
“I like the idea of the lenders sharing a database and seeing where the offenders are,” Blair Anderson of Anderson and Associates told MortgageBrokerNews.ca. “A list available to lenders only is something I would certainly condone.”
Perhaps reporting offending brokers to REDX – which collects and tracks fraud information on industry professionals -- is one way to deter unscrupulous behaviour.
However, a REDX rep would not confirm whether reports were made on the 45 brokers.
“Subscribers may exchange Incident Reports through REDX; however, they may not republish or share Incident Reports received from the REDX Service with parties outside of their companies,” Paul McGowan, national marketing manager for Teranet
told MortgageBrokerNews.ca. “Hence, we are also not able to disclose any specific detail to outside sources (i.e. media) regarding these specific 45 brokers and if they have had previous or new REDX reports generated against them.”
The industry has been reeling since it was alleged 45 brokers falsified income documents for mortgage applications with Home Trust
, and many have called for those brokers to be exposed to the entire industry.
No names have yet been released and a Home Trust representative told MortgageBrokerNews.ca it has no plans to.
And industry players argue there aren’t enough repercussions to punish brokers who commit document fraud.
“The basic problem is that there have not been any adverse consequences (for) falsifying information,” Ad Lakhanpal of Mortgage Alliance
wrote on MortgageBrokerNews.ca. “Once a mortgage is registered, neither the lenders nor the insurers take any steps to revoke it or hold people accountable, even if the fraud is discovered later on.”
And while the REDX platform offers one potential solution, it is not without its faults. It has been criticized in the past for accepting anonymous – and, in some cases, erroneous – reports. However, past MortgageBrokerNews.ca coverage
spurred changes to the system that allow industry professionals to contest reports and apply to have them removed.