The Role of Training in Preventing Mortgage Fraud with Bob Simpson of Daylight AML, David Kittle, Alice Alvey and Bill Corbet of Lykken on Lending

The Role of Training in Preventing Mortgage Fraud with Bob Simpson of Daylight AML, David Kittle, Alice Alvey and Bill Corbet of Lykken on Lending

In this episode of Lykken on Lending, we explore the critical importance of the Bank Secrecy Act (BSA) and Anti-Money Laundering (AML) regulations for mortgage lenders. David Lykken is joined by industry experts Bob Simpson, David Kittle, Alice Alvey, and Bill Corbet to discuss how these regulations affect lenders, the responsibilities around filing Suspicious Activity Reports (SARs), and the role of compliance in preventing fraud. With real-world insights from Bob’s extensive experience in mortgage fraud investigation and contributions from Alice and Bill on best practices for training and risk management, this episode provides essential guidance for navigating the complexities of BSA and AML in the mortgage industry. [David] Listeners, we' re on for a real treat today. We're talking about something called, you're ready for this folks. This is a mortgage test for you. It is The Bank Secrecy Act and Anti Money Laundering, B.S.A.M.L. You say, why do I need to know anything about that? Mortgage bankers are now included, and we're back with Bob Simpson. But joining us is going to be David Kittle. I've got Alice Alvey, and hopefully Bill Corbet will be making it in. But it's good to have you all here. Kittle, you're the one, we're using last names because there's two Davids here, so we're not being rude to Mr. Kittle. We're going Kittle and Lykken. So, Kittle, why don't you give us the introduction to Bob? You have a long history with him. Give us some insights and why this is such an important topic. [Kittle] Thank you, David. And yes, I'm honored to introduce Bob. Bob's not only a good friend of mine. I met him while I was going through the chairs for MBA was a chairman elect, I believe, and we spoke in Chicago together and became great friends from that. I ended up working for Bob at IMark when he was doing the deep forensic reviews back after the meltdown and 07, 8 and 9 and he did the reviews for the M.I. Companies. Bob was so good at what he does and he'll tell you a little bit about this, but he was actually asked to be on 60 Minutes as the expert during the meltdown with Scott Pelley. That was a real honor for him. I really can't find anything wrong about Bob, except one thing, if I could mention it. As a Kentucky fan. I love to brag about my basketball championships. Bob not only went to UCLA. He went to Duke, so he likes to tell me he has 17 national championships, and that really rubs me the wrong way. Great guy and Bob, welcome to the podcast and take it from him. [David] Yeah, Bob, give us a little bit of your background. I love that. [Bob] Yeah, David and I met the morning that tarp passed. The very morning we were speaking at a mortgage conference in Chicago, he had the breakfast and I had the lunch or vice versa. I forget which. But we met there on that auspicious day. Thinking back on those times, those were times where none of us slept much. You'd wake up at two in the morning and turn on squawk box kind of thing. And you're trying to figure out what was going on with the world. Yeah we met October 2. Wow, we're right on it, David. This might be the anniversary of the date we met. It just might be. I think it is. We met that day in Chicago, and just stayed in touch, and have just professionally, he worked with me at iMark for a number of years, happy to have him and yeah, David's always been dear to me. My background, how come I end up good at this? I spent 10 years as a loan officer never even a direct lender. I was a broker and  back in the day as a paper files, and after 10 years of doing that, I joined a law firm to help their mortgage fraud practice. I didn't know much about being a lawyer, but I was hired to do the investigation and tear a file apart and then tell them who likely knew what and when. I was teamed up with a more experienced litigator and we litigated these things. It was a lot of fun. Then about 2000, a little before, I opened up iMark and ended up being the largest mortgage fraud investigation company in the country and had a great experience. Went into the MI company there in one of them in North Carolina, and they said, how much can you handle? and I had no employees at the time. I was in a position where I didn't have a lot of horsepower, and I said what do you got? And they sent me 200 investigations to be completed in 30 days. I had a core of half a dozen people. We jumped in and that's cash, credit, debts, employment, income, valuations. Get it all done and give them a board ready report in 30 days. Wild. Turns out they never sent less than a couple hundred thousand dollars a month every month for years thereafter and we got the next MI client and we got the next MI client and we developed this reputation for knowing what was going on with defaulted loans and problem loans. And I had to develop skills around making that a workflow, and I'll tell you why. We wanted a lot of things to be done and verified before we ever reached out to a witness. You always want to know the answer to a question before you ask the question. If the bank statement was fake, we wanted to know that before we called the borrower and said, do you really bank here? We want to know the answers to those things and the only reason that I ended up, I think with Pelly and 60 Minutes and Mr. Lykken, I know you know him and he's a friend of yours. I'd given three speeches in Las Vegas in one weekend and I was tired. and so my wife and I went out to Red Rock. Turned off the phone. Off. Just my wife and me. Get away. She beat me at bowling. We had a great Sunday. Land back at John Wayne on Monday morning and my phone's going off my office saying, Hey, Pelly called. I returned that call pretty quick and we ended up filming this episode up in San Francisco. It was a blast. It was one of those moments where your mother's very proud. My son's on 60 Minutes and not for the wrong reason. I got my anti money laundering certificate a couple of years ago and I'm just enjoying now teaching Bank Secrecy Act anti money laundering to mortgage lenders. I've got this niche. I'm not about teller windows and bags of cash. I am all about what you face if you're a mortgage lender. And you started David, saying, Hey, what are we doing with, Bank Secrecy Act? we're mortgage lenders. we're covered, and we've been covered since 2012. And that means we've got to file these things called SARS, Suspicious Activity Reports. When we find fraud and think how much fraud we have, whether it's occupancy or employment, we have a responsibility to file these suspicious activity reports. It's not a little known area of compliance, but it is one that kind of gets by some of us where we think FinCEN doesn't touch my life. Financial Crimes Enforcement Network. It really does touch our lives as mortgage lenders. [David] And to the point, Alice, you at Union Home, have actually started training on this. Talk about that, because I think that's really exemplary of Union Home as a leader in the marketplace, that you guys are one of the few companies recognized early on and actually set up some programs. I'd love to hear your story and then get your feedback. [Alice] Absolutely. Great to have you on the show, Bob. You've got a wealth of knowledge and experience, and I can't wait to hear more about that. Where Union Home is at today, we definitely are very aware that this is something that we have to monitor, have policies and procedures for, and Dave, as you said, provide regular training for everyone from beginning to end of the business process so that they know how to detect the fraud and as you said, know what to do to escalate it so that the compliance officer gets what they need to know whether or not they actually have to file that SAR report. Perhaps, we should take a step back to tell lenders and tell our listeners about AML and BSA and what that means for a lender, should we start there so people know what they have to do, because I think, usually it's thought of as, oh, like you said if the teller got $10,000 in cash or, now they've triggered some rule, but for lenders, it really does boil down to watching for that mortgage fraud in the file. It's not about a $10,000 transaction like it's often thought of for banks. Yeah. [Bob] Alice that's exactly right and we tend to think, oh, money laundering doesn't affect me. Let me give you an example of one matter I saw here recently. We're all used to gift funds. We all understand that parents, we have the gift form, and then one, maybe two relatives give a gift. The file that we saw had about ten grantors of gifts. All coming from overseas, all coming in different language accounts, and they ethnically didn't seem to be related. Now I have a lot of questions. Are those really gifts without any obligation to repay? or am I watching about $100,000 in ill gotten funds mulled into my transaction? Mulling is the term of art for when you get an anonymous person, somebody else to carry your money in. We see those things sometimes, not often, but when you do see it, you're entitled to file the suspicious activity report to say, I don't like what I'm seeing here. You don't have to prove it, but it's good to file it and say, we're not liking what we see. [David] Great point. Alice, when you're training on this? To what extent do you get into the specifics of calling it training your staff at Union home? to call us to attention because I'm thinking of the customer. I've got a customer I'm working with, Alice, and you're thinking, Gosh, is this going to turn this into the FBI? Is this going to create a problem for my customer? You can understand some of the hesitancy to do this, but it's a requirement. And how do you bring that about us? [Alice] It is a fine line to try and help people feel like I don't have to be suspicious with every loan file and spend hours on everything. It's about teaching people what are real red flags and that one red flag doesn't make fraud. But when you start seeing a couple of red flags, You have to report it and the key is to make sure your frontline people are reporting everything. They're escalating it up and it's going to then, the next layer of individuals who will do the research, do the double checking, and then determine at that point what is something that truly is actual fraud and not just a borrower who's made a mistake or something that we've misunderstood. The escalation process is key and making sure you're getting those submissions from the front line. That's really what we stress. And it makes a big difference in keeping you out of being in the middle of some fraud scheme. [David] Bill Corbet, good to have you joining in on the call. Turn it over to you. [Bill] Alice, I think all of that is spot on and what I try and understand and be able to communicate to folks and is I think the challenge is, when do you cross from underwriting a loan to addressing fraud? and I think you hit on a key point of, it may not be one particular item, but how a pattern develops within a transaction and so that's my question for Bob is how you make that bridge from your an underwriter making a credit decision versus identifying and acting on potential fraud. [Bob] Bill, it's a great question. I had to let one investigator go who couldn't tell the difference between an underwriting goof and fraud. I kept getting these reports and they just weren't getting the concept. It's a great question. You got underwriting differences and you got different ways to calculate income and what are we counting and how much on that, that second income. Those are all legitimate underwriting questions. Where it crosses the line is when you end up with false stocks and when you find out that Schedule C is the second version. It's cooked up. When you find out that, whether it's through 4506 or through other means, you find out that the information provided was materially false. That's when you're in the position. But, I want you to be comfortably away from just underwriting disputes, just that's not what meritists are. Imagine you're law enforcement, you're the FBI, you don't want to see underwriting disputes come over. You want to see money laundering and fraud and there was a bar in Fullerton called Silky Sullivan's. And, I got great stories about Silky Sullivan's. Nonetheless, the perfect horse racing, David. There was a CPA whose office was above Silky Sullivan's and every realtor within 10 miles of this office in Fountain Valley knew for 400 bucks you could get two years tax returns and pay stubs out of this guy. And he had a thriving mill going, generating all this stuff for local realtors. Now let's talk about you find it. Let's say you're United Home and you go, Whoa, look what we got here. We got the Silky Sullivan tax returns. You are able to say we found this. Our guy looks like he was or wasn't involved. Here's the name of that CPA and if or suspect others are working with this guy, you are free to speculate. You are free to say, Hey, this whole office over here of realtors We've heard that everybody is using this guy. Why? Because these suspicious activity reports are just that. It's your suspicions about what's going on and law enforcement appreciates it. They're totally confidential. You're not going to get in any trouble for speculating and you can do that. This is where law enforcement needs you as the experts to go, yeah, I think I know what's going on here and go ahead and tell them in the suspicious activity report. [Kittle] Just another tangent, what we're talking about what Bob does here. He has amazing courses developed. If I've got a mortgage company or I'm a credit union or a community bank, I want my C-suite to take these courses. They're professional. They're well done. As Bob said, he was a loan officer. He's run iMark and owned it. He has the perspective of everything you need to teach this course and he gives real life situations and stories like he's doing with us now. It's a quality course. You don't want at least I wouldn't people to do this type of course with this type of risk involved to quick click, just so I can say I did it. And you don't get that from Bob. [David] And not only that, David, we'll talk about this a little bit later towards the end of the podcast interview. But you'll talk about how you're integrating this into TMC education. I want to get into that. We'll talk about that in a little bit. Alice, back to you, because this is a deeper topic in what is required. I'd love to get into your thoughts and any questions you might have around that. [Alice] Bob, I think our listeners would like to hear, what's a big scheme that you have uncovered and what could the lender have done to try and avoid that? We all want to learn from each other on spotting those schemes that could end up costing us many thousands, tens of thousands and hundreds of thousands of dollars. [Bob] Great question. And let me give you a fun way to handle those things. I had a client who had what they called freaky Fridays. Where they would get all their underwriters and their front line people together on Fridays. The company bought lunch and everybody would share stories about the weird stuff they'd seen that week and what do you got going? And they found somebody with no income and their only source of income was a really healthy child support court order and so there weren't fake bank statements. There weren't fake VOEs. Just court orders. When they got in and started digging around, it was a common scheme, this realtor and this loan broker were putting together false income and selling people houses and they were cooking up fake child support orders from a Van Nuys court, but when they used these in other jurisdictions, they were too lazy to find out how those courts named their cases, and so they were using the wrong case numbers. Fannie Mae found out about it and issued a big proclamation, hey, look out for weird income that's all coming from an unusual place. Here's how you can foster this cooperation among your own people. You find weird stuff. You find things in files. Get your people talking. There was another matter. It's related to the same topic. A truck driver took a $50,000 dollar add back for depreciation on his schedule. We all know that if you take depreciation, we're going to let you add that back into your income because that's what we do as lenders. It's just a phantom loss, right? When this lender got their underwriters together, we found about 10 files all done by this one loan broker and all of the tax returns and schedule sees were done by one CPA and he gave every one of these guys $50,000 ad back. Their real income was 30 The CPA added back 50 and all of a sudden they're homeowners because they got 80 grand in income. That's the kind of thing that you can find if you got your people talking internally, help them. [David] I like the idea of freaky free on Fridays. That's actually not a bad practice because it gets us talking amongst each other. It's one upsmanship. Let me show you the weirdness. I saw this freaky thing I saw this week. That's actually a pretty good practice. I like that. [Kittle] Bob, we used to have that my underwriter, writer Paula Bova, who's still in the business, a great underwriter. She used to have a mug group, which was a mortgage underwriter group and they would get together once a month in here in Louisville and said from different companies and find out what's going on and what was good and what was bad. It's a great idea. [David] Great idea. Yeah. [Bill ] Let's go back and talk about from the IMB perspective specifically, right? Banks, credit unions have a culture. To your point, Bob, it may be a box check, especially on the smaller IMBs, how do you get the culture and the mindset in from the top down that this is something that everybody needs to get into their DNA and not just pay attention when they have to take the course once a year? [Bob] Yeah, I think that attitude springs from some of the courses available until now have been check the box and not really relevant. They don't feel like they're relevant. I want to marry that up with a changing requirement of FinCEN that says that the C suite and the boards have got to train in this now and they're getting serious about it and they're delivering that message. But if you can comply and do it inexpensively, there's no reason not to. The training isn't that expensive. To have a designated BSA officer. But they can be the broker of record. They can be your head of QC. They can be somebody, you don't have to have a special position for the BSA officer. Just name somebody in your organization. I would say that here's what you need to do in your policies and procedures. Write it up. I know this is hard. I had a mortgage brokerage with eight loan officers, two processors. Okay, so that's my background of this. I know there's not a lot of room in that spreadsheet for superfluous costs, right? I get it. And in this market, even more but name somebody as your BSA officer and then your biggest problem is going to be putting it in your policies and procedures that they're insulated from the pressures that we all know exist come from producers. Don't bust that guy. He's my biggest producer is we all know that pressure in this industry to guard our realtors, CPAs, our referral sources, our builders, if we're a correspondent, we all know that pressure to let's not bust that guy and it's real. I think you at least need to write it up so that your BSA officer has a level of confidentiality and protection with that kind of thing. Alice, from your desk, did I hit that? What do you have to add on that subject? [Alice] I think you hit it. I would add that it really helps to show the loan officers the fraud and show them this is what somebody tried. We see this is not anything new, we know how to catch this, and people go to jail and when they get that realization that yes, there are convictions and people go to jail, and this is wrong, right? Some of them think, oh, I'm just helping the customer get into the loan, right? What's wrong with helping somebody get into a file by maybe fudging this or that in the in the income if I just, I changed one decimal, I changed something on a bank statement, or it wasn't really a gift and they get themselves talked into a little white lie and they do it once and then it happens again. People go to jail for that stuff and that's a big eye opener that we found can be effective with our loan officers. They sometimes are shocked that people do that kind of thing. But I'm curious, Bob, what, what are the costs that you see what to comply with BSA and what do you think are the top buttons people should watch for to make sure they're in compliance? [Bob] Let's start with a successful audit. If somebody came in and audited you, if your regulator came in and said are you guys good? are you doing this right? All right, let's start with, yes, you get the gold star. How do you get the gold star? You have a qualified and well supported BSA officer, which means they have some kind of budget and they have some kind of training, okay? They do a risk assessment and there's a change now from FinCEN that this is not just a good idea anymore. They really want this written out. They want you to observe your risks and is it geography? Is it the type of loans you're doing? Is it the people you're dealing with? assess your risk, put them in policies and procedures, and then train. Every 12 to 18 months you need to do an independent audit, and that may be your most expensive part of this whole thing is an independent audit every 12 to 18 months. It's gonna be not that much if you're a small shop, it's gonna be a little more. I won't ask Alice, but I'll bet you your bill for an independent audit is bigger than the ones I send out for small companies. That might be your biggest expense with this and the training is fine, it's by the seat and you can buy mine or somebody else's and get the training for this. It's not a big cost except I think for that, that annual audit to make sure that you're okay. Did I miss any costs that you guys are facing there, Alice? [Alice] I think people look at like you said, independent audit. A lot of it is something that you should have an outsider do. Sometimes they think independent. What if my secretary does it and she's independent? It's not somebody who's Independent just within the organization always. I think that's a stretch. I would agree with the cost and I think it's the team of people that it takes to watch it throughout the year. It's not something to just get ready for an audit and hope you're clean. You're trying to monitor this all year. You're spending the money to save money in staffing. You're spending the money to save money against fraudulent loans that you have to repurchase. [Bob] And the number one rule everybody's got to take to heart and really live by and I know it's hard to do, but Is if it's not written down, it doesn't exist. If you say, yeah, I assessed my risks. Unless that's just really a written out thing with the questions and answers that an auditor can go, yeah, looks like you assessed your risks. If it's not written down, it does not exist. This is really a note taking exercise to a lot of extent. So you trained your people. How do you prove it? If you can't prove it to the auditor, you didn't do it. This is one of those things where you almost want to have it in a booklet and just hand it to the auditor and say, I'll see you Tuesday. Just do this. It's really a reading exercise at the end of the day. [Bill] I keep hearing out there, conversations around the Russian oligarch rule and can you talk about that, what that is and how it applies to the anti-money laundering? [Bob] Sure. I think that, yeah, I don't think it's officially referred to as the Russian oligarch rule, but that's how we all refer to it. Let me just give you a little bit of perspective. Money laundering was not even illegal in the United States until 1986. [David] Are you kidding? [Bob] No, it's hard to believe. But we had the Bank Secrecy Act in 1970, where we said we gotta start checking people's bank records. The state of California sued and said, you can't check our banks, we don't want you to and the Supreme Court said, yeah, we're checking and too bad. So that started in 1970. 86 the Anti Money Laundering Control Act was put into place. Patriot Act, after 2001, added a bunch of terrorist financing issues here, okay. for us to check over and one of the things is the Russian oligarch situation where so many Russian oligarchs were buying property in London that it became known in the AML community as London Grab, okay? It's just crazy. Russians bought everything. You know those spires, those needle buildings in New York City and Manhattan, those super luxurious, thin little buildings that go up? So many of those were bought anonymously with dirty money. Just a ton of them. FinCEN decided we got to stop this. We got to know who buys real property in this country. They've required us and it's active, it's the rule now. That you got to file these beneficial owner information reports. I just did one for my own company. It's no big deal. It's ten minutes. It's not a big deal. It's who owns the company, what's your address, attach your ID to it and send it on in. You can mail it or you can do it online. It's not a big deal. But it is designed to prevent anonymous transfers of property. And so just take it that This has in years past been a real problem and a real method for drug money,  human trafficking, arms trafficking. It's been a real convenient way to transfer that money back and forth and so that's their attempt, and it feels like a real pain, but I just did it, and it isn't that bad a deal. [David] You give a lot of great examples of some stories that and we always I think we remember these stories more than anything else and it's important to this David Kittle, you and TMC are really launching an initiative to make this a part of a curriculum that you're developing. If you could talk a little bit about someone who's a TMC member, the benefit they have as a result of, especially when it comes to this kind of training. [Kittle] Sure. We've we launched a couple of years ago called something called TMCU and courses through there, there quality courses, but they were courses that people would maybe want not necessarily need and as the market slowed down, it just, we really weren't selling any of that. I stepped in as CEO earlier this year. I had began to revamp it and look at some education partners that we can put on a platform that will offer discounted continuing education in MLS. The BSA, the anti money laundering anybody who has training is going to be able, that is a member of one of our preferred partners, will be able to put it on this particular platform and it's like going to a portal and link it up and they'll get a discount and Bob's going to be part of that. And we are 45% depository, so our credit unions and certainly our community banks. We'll want his AML product inside the C suite, but so will the IMBs as well. But you certainly want it on the depositories. [David] Yeah. I applaud you for the fact that you bring this kind of training out, so kudos to you on this. Let's go around with the last round of questions. Alice, do you have any other questions or anything that you want to ask Bob? [Alice] Bob what's up and coming? Are there any changes in the future that we should watch out for AML that might be pending for this regulation? [Bob] Yeah good question, Alice. July 3rd FinCEN published a proposed rule comment period was until September 3rd to strengthen AML compliance and there are four, five, six things in there, but my eye was attracted to three things that they want to enforce. One is they want your program to be effective and I know that sounds hasn't they always wanted that? No. They wanted you to have a reasonably designed AML program, and now they are saying it's got to be effective. A lot of blowback in the commentary on this proposed rule about what the heck does that mean? You got to put a little structure around this, but here's my interpretation. My interpretation is that they are saying we've seen the training. We know that what's out there is shallow kind of change your password kind of training, but it's not really getting into the money laundering that affects your industry. So I think they want you to really be effective, the second thing is they want boards and the moral equivalent, the C suite, to be trained. and to take responsibility for this BSA thing. The blowback in the comments was, Hey, we're board members, we're mortgage people, we're not any money laundering specialists. What do you expect us to do? The retort you're not IT experts either, but we expect you to hire the right people to protect your data. So we don't want to hear that you're just a board member. That's not gonna wash and so there's this focus on making things more effective and the last thing I'll point out is that they've always said it's a good idea to do a risk assessment and now the proposal is. It's got to be formal, it's got to be written, you have to write it out, and you have to write that you've assessed your geography, your client base, the types of loans you're doing, and then put those in your P&Ps. How are we going to handle this? are we going to have freaky Fridays? What are we going to do to make sure that people are, talking? Always a good idea before, but now they're insisting it be written. So those are the three big ones that we want to watch for. Again, it's a proposed rule right now. We don't have any information on timing, I don't at this point, but we'll see what gets adopted. But it's a heavier hand. Let me say this, it's a heavier hand than has existed before. [Alice] Now when I read that I went back to, they don't want to just see that you filed a SAR report on time. They want to see that your people when they're being trained, they're actually reporting to your compliant, your BSA officer. so that's one way you can show its effectiveness, is that your people are identifying fraud and they're pushing up those reports internally as well. Thank you for that. Those are three things. [Bob] I think, if I can interject a little thing about TMC, this is a perfect way for TMC to get everybody in the mix about what's going on and I know all of our lawyers get really nervous when you start saying this is best practices. Every lawyer, don't say that. Okay. But in inside of TMC, we can get lenders talking about here's what I'm doing. Here's what I'm doing. Here's how I keep that divide between investigators and origination and people can start to share this and I think that whole TMC concept is really going to help their members to feel like they've really got a handle on this thing. [Bill] Bob, two things for you. One, and even though you just used best practices, but do you have any thoughts, best practices on how lenders can and should be interacting with their settlement agents? Because that seems to be the other place where, let's face it, that's where the money changes hands and was number one and number two it sounds like when you start talking about effectiveness and everything that a lender that doesn't over a reasonable period of time have any issues getting identified and escalated by itself might be a red flag in terms of are they not understanding what to look for, not looking deep enough. [Bob] Two great points. Alright, so let me start with your settlement agents first. Alright. Alice, you started by asking, What's the biggest thing I've ever handled? I investigated, and this will be a good reading for you if you want to check this out when the podcast is over. Phil Hill in Atlanta. About 700 land flips in Atlanta and what Phil did, was to work through three closing agents, Bill, who, to close all of these bogus transactions, and he would buy a property for $200,000 back in Atlanta, when you could buy a condo for $200,000, and quickly sell it to a stolen identity for three and pocket the difference and this all just came through three settlement agents. Closing protection letters, be damned, these guys were in his pocket and helping facilitate a scam. It's a problem. Dishonest settlement agents are a real problem because they, as you say, they are the ones with the money. Now, my investigation tip would be this. Oddly, no matter how many crooks are involved in your file, it seems to be that the closing disclosure Is accurate. It's like they just cheated you, they got it done, they took your cash, and now whatever, and the closing disclosure so many times is accurate. It's astounding to me. It's just like they give up. They've told enough lies. We had these guys dead to rights based on money in and money out through closing agents who knew in six, seven hundred transactions that this money was all going back to Phil Hill. Now, I'm all for landing on the bad guys, but Phil got a very serious sentence, 30 years. For white collar crime, even that one struck me as, that's a pretty long sentence. Then you mentioned the second issue is, what if you're just not getting anything? are you clueless, or are you just a super clean shot? I hope everybody is super clean. When I advise, when I counsel on finding red flags out of a portfolio, let's say we're going to look at 50 loans and we're going to find red flags, I hope 48 of them are clean. I hope you don't have 12 dirty files out of 50. We have to start from the presumption that yeah, I think most of your business is going to be clean and if you have two out of 50 files, that are dirty. You probably have a little training to do. You probably have a little tightening up on your origination side, but you're right to raise it. If you have nothing, are you just not paying attention? [David] Good stuff. We could go on with this discussion. It's not one of the sexier board until intellectually stimulating ones, but it's absolutely necessary. I applaud Union Home and Alice for the training and the focus that you guys have put on. That's why you're the market leaders. I thank you for joining the call and Mr. Kittle as well and Bill, thank you for being here. Bob, it's always good to have you join the podcast. [Bob] David, pleasure. [Kittle] David, it may not be sexy, but if you don't have it and you get caught in your company it's a saving grace. [David] Yes, it is. it's so important that we talk about these more sensitive issues. Bank secrecy act, anti money laundering. It's important that you have a program. Do you have it listeners? You need to learn more about it. How to set one up, get a hold of Bob. Bob, how can they reach you? [Bob] daylightaml.com and it's bsimpson@daylightaml.com. Happy to help anybody talk through this. [David] Very good. We'll put your contact information in the show notes. Thank you everyone for joining in on the interview. Alice, David, Bill, appreciate it and of course, Bob, thank you for being here. [Bob] Thanks, everybody. [Kittle] Welcome.

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Bob Simpson started a successful mortgage fraud investigation company in 1997 called IMARC. By 2008, it was the largest mortgage fraud investigation company in the US, investigating tens of thousands of fraudulent loans. Bob is a certified anti-money laundering specialist (ACAMS), a lawyer, and a former loan officer. He was a prominent and early analyst of the 2008 financial crisis, even appearing with Scott Pelley on an episode of 60 Minutes. This year he's launched DaylightAML, an online course to help lenders navigate fraud and money laundering risks. His experience with the darker side of our business can help us avoid loss and reduce risk.