CMHC beefing up mortgage fraud detection

TORONTO — Canada Mortgage and Housing Corp. is beefing up its ability to detect patterns that may indicate mortgage fraud after being directed to do so by the federal government, the agency’s president and CEO said Thursday.

“There is no evidence that fraud is a widespread problem,” Evan Siddall said following his remarks to the Canadian Club of Toronto.

“But we know it happens, it’s very hard to find, and incentives exist for fraud in the system, so we need to be vigilant.”

Mortgage fraud has been a hot topic following recent events at alternative lender Home Capital, which has been dealing with the aftermath of a scandal involving falsified loan applications.

In 2015, Home Capital severed ties with 45 brokers over fraud allegations. Two of those brokers have been sanctioned by the Financial Services Commission of Ontario, while the other 43 have not.

More recently, Home Capital faced a liquidity crisis after customers started yanking out their savings following Ontario Securities Commission allegations that the company misled investors in its disclosures surrounding the fraud issue. The company has said the allegations are without merit and has vowed to defend itself.

Siddall said CMHC’s stepped up efforts around fraud detection were not triggered by Home Capital, but by a directive formally issued to the agency by Ottawa.

The housing agency is looking at ways to use data analytics to spot patterns that could be indicative of fraud networks or fraud rings. That would allow it to approach lenders when it spots something suspicious.

“We’re looking for associations among individuals that aren’t apparent from an individual application for mortgage insurance, but are apparent when you look at a large number of applications, and then you can identify networks and patterns,” said Steven Mennill, CMHC’s senior vice-president of insurance.

CMHC has not seen any increase in mortgage loan defaults as a result of the Home Capital matter, Mennill said.

Home Capital also remains a CMHC-approved issuer of mortgage-backed securities, through its subsidiary Home Trust Company, Siddall said.

“We’re monitoring the situation daily, as we do with many lenders,” Siddall said.

Just Posted

Blackfalds firefighter battling cancer

A volunteer firefighter in Blackfalds for 15 years, Dave Sutherland now battling… Continue reading

Red Deer transit users are concerned about the future

But recreation centre users are glad facility hours were maintained

Community cardiac awareness dinner and show to be held

Continued focus to bring cardiac catheterization lab to Red Deer

Red Deer businesses react to 2.02 per cent tax increase for 2018

Chamber would prefer zero increase, while DBA thinks it’s reasonable

Bring on the rodeo says Red Deer County mayor

Canadian Finals Rodeo’s move to Red Deer good for whole region, says Red Deer County Mayor Jim Wood

WATCH news on the go: Replay Red Deer Jan. 21

Watch news highlights from Red Deer and Central Alberta

RDC chosen to host 2019 men’s volleyball national championship

Sports enthusiasts in Red Deer will have more to look forward to… Continue reading

Police is still looking for Second World War army passport owner

No one has claimed a rare Second World War German army passport… Continue reading

DJ Sabatoge and TR3 Band kick off Sylvan Lake’s Winterfest 2018

Central Alberta’s youngest DJ will open for TR3 Band kicking off Town… Continue reading

Two Canadians, two Americans abducted in Nigeria are freed

Kidnapping for ransom is common in Nigeria, especially on the Kaduna to Abuja highway

WATCH news on the go: Replay Red Deer Jan. 21

Watch news highlights from Red Deer and Central Alberta

Liberals quietly tap experts to write new paternity leave rules

Ideas include creating an entirely new leave benefit similar to one that exists in Quebec

Insurers say Canadian weather getting hotter, wetter and weirder

Average number of days with heavy rain or snow across Canada has been outside norm since spring 2013

Are you ready for some wrestling? WWE’s ‘Raw’ marks 25 years

WWE flagship show is set to mark its 25th anniversary on Monday

Most Read


Five-day delivery plus unlimited digital access for $185 for 260 issues (must live in delivery area to qualify) Unlimited Digital Access 99 cents for the first four weeks and then only $15 per month Five-day delivery plus unlimited digital access for $15 a month