Five California companies appear to not actually exist
The number of fake employers showing up on borrowers’ mortgages is growing.
Earlier this year, Fannie Mae issued a warning to lenders after identifying more than 30 companies that appeared to be fake that were showing up on borrowers’ mortgage documentation as their place of employment.
The 30 companies were generally located in the Southern California and Los Angeles County areas. But the wave of fake employers spread throughout California, as Fannie Mae later called out 10 more potentially fake companies located in Northern California, including some in Silicon Valley.
Now, Fannie Mae is issuing another warning, telling lenders that it has found five more potentially fake employers in the state of California.
The newly identified potentially fake employers are:
- BTR International, located on S. Olive in Los Angeles, CA
- Building Blocks Learning Center, located on Calabasas Rd. in Calabasas, CA
- Digicox Printing Material, located on Sherman Way in North Hollywood, CA
- Volt Temp Distributors, located on Gladys Avenue in Los Angeles, CA
- Western Law Group, located on W. Glenoaks Blvd. in Glendale, CA
According to Fannie Mae, there are a series of red flags that lenders should be on the lookout for on loans that could include a fake employer or other potential mortgage fraud issues, including:
- TPO / broker loans
- Originated 2015–2018 (present)
- Employment (occupation) does not “sensibly” coincide with borrower’s profile (age or experience)
- Borrower on current job for short period of time
- Prior borrower employment shows “Student”
- Starting salary appears high
- Purported employer does not exist
- Employer’s purported location cannot be ascertained
- Paystub templates are similar for various employers across other (involved) loan files
- Paystubs sometimes lack typical withholdings (health, medical, 401(k), etc.)
- Gift letters are substantial and are not (or cannot be) supported through re-verification