Posts by Joan Ferenczy
Joan Ferenczy is Vice President, Financial Instrument Fraud Officer at Freddie Mac. Ferenczy first joined Freddie Mac in 1982 and has held a number of positions of increasing responsibility with the company's fraud investigations unit since 1989. Ferenczy reports to Mark DeLong, Freddie Mac's Senior Vice President of Enterprise Operational Risk Management. Under Ferenczy's direction, Freddie Mac's team of professional investigators aggressively probes and pursues individuals and companies who may have committed fraudulent acts involving mortgages owned by Freddie Mac. These investigations have led to hundreds of indictments and convictions, and tens of millions of dollars in civil judgments and restitution orders.
Can you spot the fraud in this rental ad? It looks like your typical Internet home-for-rent ad. This one happened to be on Craigslist and the fraud could cost an unwary renter thousands of dollars. Here’s the scam: the advertiser doesn’t own the house at the address. Freddie Mac does. It was never for rent and it’s scheduled to close next month. (Craigslist immediately pulled the ad after they were notified about the problem.)
Unfortunately, we’re hearing more reports about fraudsters trying to cash in on the housing crisis’s remaining foreclosed homes by advertising them as rentals on the Internet. It works like this. Once the house is sold at foreclosure, the fraudster posts an ad online and tries to rent it before it can be sold to a new owner. People contacting the fraudster about the ad are asked to submit their personal credit information as part of the lease application plus two month’s rent.
Mortgage fraud doesn't look like a TV crime scene with yellow tape and flashing lights. It generally doesn't show up on security camera footage or in the sort of dramatic photos that make the front page or go viral on the Internet. That's because mortgage fraudsters, like any predators, rely on camouflage to hide their intentions and lull their victims into a false sense of security.
Freddie Mac's fraud investigation team has over 20 years of field experience uncovering such "camouflage" and helping law enforcement agencies prosecute mortgage fraudsters.